The Hanoi administration has taken moves to speed up its economic growth to serve the 6.5% GDP growth target this year, and the economy is likely to achieve 5.7%-5.9% in the first quarter.
Vietnamese Prime Minister Nguyen Tan Dung requested on March 10 that major state-owned enterprises, which contributed more than 40% to the country’s GDP, to achieve at least an average 10% growth this year.
“Major SOEs which are the backbones of the national economy must play pivotal roles in stabilizing the macro situation, curbing inflation and ensuring social security,” PM Dung urged executives of over 100 SOEs in Hanoi.
SOEs must check out investment plans and focus on significant projects to boost production efficiency, Dung urged, elaborating “once power or fertilizer factories start operation effectively which will help boost exports.
“The government will create favorable conditions for effective projects particularly ones abroad,” pledged, adding that “restructuring, or even liquidating loss-making state firms is also a must.”
The Vietnamese government late last week announced its spending of VND791 trillion ($41.4 billion) for development projects this year, up 12.3% from a year earlier, after disbursements were slow in the first months of the year which included the Lunar New Year or Tet.
Earlier the government forced state firms to sell their forex deposits to sell to local banks before end-Feb and ordered all the gold-trading floors to close through the end of March, according to reports by state media.
At end-2009 SOEs posted a combined pretax profit of VND80.799 trillion on revenues of VND1,164 trillion, up 10% and 2.9% from a year earlier, statistics of the government showed.
However, economists raised concerns about capital-using efficiency by SOEs as they expanded their operations into non-core business activities.
The National Assembly Standing Committee said in a report in November 2009 that 40 out of 91 major SOEs had been operating ineffectively with ROE at below 10% due to their mass investment in non-core business such as finance, stock, investment funds and realty projects. (chinhphu.vn)
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