(VEN) – Business restructuring must be implemented despite difficulties, said Minister of Industry and Trade Vu Huy Hoang at a conference on business restructuring and the implementation of Government Decree 99/2012/ND-CP dated November 15, 2012 (referring to the rights, responsibilities and obligations of state owners in state enterprises, and state capital in enterprises under the ministry’s management).
Petrolimex is the first economic group of the Ministry of Industry and Trade to be equitized
Problems
According to the Business Renovation and Development Committee of the Ministry of Industry and Trade, a year after the implementation of Prime Ministerial Decision 292/QD-TTg and other prime ministerial decisions related to the restructuring of the ministry’s corporations and economic groups, all wholly state-owned corporations and economic groups have had their 2013-2015 restructuring plans approved. However, since 2010, the ministry’s business restructuring has tended to slow down and encountered a lot of difficulties.
Phung Dinh Thuc, Chairman of the Members’ Board of the Vietnam National Oil and Gas Group (PVN) said that because of the gloomy securities market, the economic crisis in the finance and banking sector and the capital security principle, the withdrawal of state capital from enterprises was facing difficulties, with losses becoming the biggest problem.
PVN has encountered difficulties sourcing capital for development investment. Previously, apart from the profits of enterprises, the government left 50 percent of the profits related to the transfer of state investment capital in enterprises. This 50-percent funding is now sent to the business restructuring and development promotion fund according to Government Decree 71/2013/ND-CP. This has meant PVN has faced difficulties in meeting its yearly investment demand of about VND55-60 trillion.
Having transformed into a joint stock company, the Vietnam National Petroleum Group (Petrolimex) has had difficulties related to policies and guiding documents. Petrolimex Management Board Chairman Bui Ngoc Bao said that the current guiding documents do not describe the difference between wholly state-owned enterprises and joint stock companies so joint stock companies face difficulties in policy implementation; more than two years after Petrolimex transformed into a joint stock company, the firm has not paid dividends to shareholders despite being profitable; a number of current guiding documents remain inappropriate; the stipulation that the capital withdrawn by a state company must not be lower than that company’s accounting book value, and unlisted joint stock companies’ transfer of financial investments valued at more than VND10 billion each must be auctioned through a stock exchange are examples; this has had a negative impact on the withdrawal of state funding from non-core businesses.
Restructuring must be implemented
Minister of Industry and Trade Vu Huy Hoang emphasized that restructuring is a major policy that is very important to the economic development of the country, and that the restructuring must be implemented despite difficulties. According Government Decree 99/2012/ND-CP and the approved restructuring plans, enterprises should continue to review their business lines and are determined to realize approved plans, prioritize the withdrawal of capital from non-core businesses and implement equitization.
It is necessary to take the initiative in issuing business management regulations, including financial regulations, regulations on the duties and responsibilities of board members, and internal regulations, continue to strengthen business leaderships, restructure ineffective businesses, strengthen the inspection and supervision of investment, personnel, labor and salary activities.
The minister said that to help businesses solve problems the Ministry of Industry and Trade has proposed that the government soon issue a resolution on promoting the withdrawal of state capital in 2013-2015 and related guiding documents.
Referring to Government Decree 71/2013/ND-CP, the ministry proposed that the government arrange a meeting in the near future to listen to business opinions. It will work with relevant ministries and sectors to solve financial regulation problems for businesses./.
By Viet Nga
Đăng ký: VietNam News