NA urges faster SOE restructuring

A 53,000-tonne ship is completed by Ha Long Shipbuilding Co Ltd. The National Assembly is seeking faster restructuring of State-owned enterprises, the banking sector and public investment in order to boost economic growth. - VNA/VNS Photo Huy Hung

This came out in a report that Nguyen Van Giau, chairman of the National Assembly Committee on Economic Affairs, presented on Saturday.

The report of the NA Standing Committee on the supervision of the economic restructuring process, which is part of NA's Resolution 10/2011/QH13 on the socio-economic development plan for 2011 to 2015, said economic restructuring in the last three years had generated results but were still below expectations.

The NA noted that from 2011 to 2014, the Government cut 1,550 projects and restructured 272 State-owned enterprises. From 2011 to 2013, the Government was also able to divest about VND3.94 trillion (US$185.5 million) from State-owned enterprises.

However, the NA added that the implementation of some reforms was still slower than expected as restructuring policies were not effective enough.

In addition, the Government had not made a comprehensive assessment of the economy and a lack of co-ordination still existed between parties in the restructuring process, it added.

Average economic growth from 2011 to 2015 is expected to reach only 5.78 per cent, which is lower than the Government target of 6.5 to seven per cent. Trade surplus is unsustainable because of domestic companies' struggle in production and consequent reduction of imports.

The economy's competitiveness has yet to be enhanced and labour productivity remains low, according to the NA Standing Committee.

State budget overspending remains high, with total debt under basic construction from the State budget and government bonds as of August 30 estimated to be about VND44,594 billion (about $2.1 billion).

Deputy Nguyen Thi Kha of Tra Vinh Province said State-owned enterprise restructuring had not seen major breakthroughs, as divestment fell short of expectations and the potential strengths of the private sector had not been fully tapped.

He added that those drawbacks came as enterprise leaders were not bold enough in their actions, thus asking the Government to eliminate the negative influence of interest groups and hold State-owned enterprises accountable.

Regarding the banking system, the NA Standing Committee said the rapid rise in the number of commercial banks in recent years had caused instability, as it had not been accompanied by enhanced governance.

Deputy Trinh Ngoc Phuong of Tay Ninh Province said resolving bad debts in the banking system required sorting out the tangle of cross-ownership and cross-investment in the sector.

Public investment also came under the spotlight as a number of deputies noted that the sector was plagued with problems such as over-diversification, inefficiency and inadequate supervision over construction.

Deputies Nguyen Van Hien of Ba Ria-Vung Tau and Do Manh Hung of Thai Nguyen Province remarked that given limited capital, the Government should conduct a review of public investment projects and organise them according to set priorities.

Regarding public investment, lawmaker Y Khut Nie of Dak Lak Province said officials who had approved ineffective investment projects must be held responsible for their actions.

Some NA members revealed that the amount of debt under capital construction could be higher than 44 trillion dong, and a clearer assessment was needed of such debts.

Others wanted the Government to take note of a series of construction projects that cost trillions of dong but have yet to achieve their full potential, causing public uproar and a slowdown in the fight against corruption.

Hien said restructuring companies also meant restructuring staff management at State agencies and their responsibilities.

Investment and Planning Minister Bui Quang Vinh admitted that the process still faced major hurdles, and areas of restructuring could take many years. He suggested that the Government order each ministry and sector to develop their own restructuring plans. The lawmakers observed that the Government needed to intensify its anti-corruption efforts and further reform administrative procedures to enhance the efficiency of public investment projects.