Covid-19, the world economic downturn, large capital that is difficult to handle and procedures are still problematic are the common causes when it comes to slow equitisation and divestment state in SOEs. However, recently, in parliament, the Minister of Finance said among many reasons, there are reasons for the implementation somewhere that arenot really serious under the direction of the Prime Minister. But this is the core. So, how to speed up this very important operation?

MobiFone is one of the enterprises to equitise in 2020. 

"Profit" is over 1,000 billion VND from divestment

According to the Ministry of Finance, in the first 11 months of 2020, the unit received reports approving the equitisation plans of seven enterprises. From 2016 to November 2020, there were 178 enterprises approved by competent authorities with their equitisation plans with a total value of 443,503 billionVND, of which the value of State capital was 207,116 billion VND. Regarding the divestment situation, in the first 11 months of 2020, the country has withdrawn 979 billion VND, earning 2,031 billion VND. Accumulated total divestment from 2016 to November 2020 reached 25,749 billionVND, while173,103 billion VNDwas collected.

Assessing the results of equitisation and divestment from 2016 to November 2020, Dang QuyetTien - Director of the Department of Corporate Finance, Ministry of Finance said the equitisation and divestment in this period has achieved some remarkable results. Specifically, the equitisation exceeded the plan in terms of quantity, the value of shares sold by the State reached 11% more than in 2011 - 2015 (8%); the divestment achieved good results, there were many highly effective divestments (Vinamilk, Sabeco). In addition, the equitised and divested enterprises in 2016-2020 did not incur negative losses of capital, State assets, enterprises; SOEs are reorganised, streamlined, and operational efficiency has been improved.

However, the process of equitisation, divestment, and restructuring of SOEs has still existed in recent years. Specifically, the progress of equitisation and divestment is slower than the plan set by the PM. Along with that, the development and implementation of plans for SOE equitisation and State divestment in enterprises have not been seriously paid attention. Although the number of equitised enterprises is positive, the majority of enterprises that can be equitised are not part of the plan approved by the Prime Minister (140 out of plan, 37 of them under the equitisation plan. 128 enterprises approved). That is not to mention, the settlement of equitisation has not been seriously implemented in several enterprises, leading to difficulties in the operation of joint stock companies, affecting the divestment process in enterprises.

Speakingabout the causes of the above-mentioned shortcomings at the 10th session of the 14th National Assembly, Minister of Finance DinhTien Dung stated that recently and especially recently, there are many reasons such asin international relations, the unpredictable developments of Covid-19 have greatly and seriously affected domestic and international financial and stock markets. This makes equitised enterprises have to consider the time to approve the plan and time given to sell shares. In addition, regarding mechanisms and policies on equitisation and divestment, recently, it has been revised, supplemented, and adjusted in a stricter direction, enhancing publicity and transparency in the equitising process and calculate the correct and full value of the enterprise when equitising, complete the establishment of management documents on land and assets before equitisation.

The Minister of Finance also mentioned the issue that enterprises equitised, divested, and restructured in this period, most large enterprises had complicated financial situations, owned a lot of land or enterprises were activities in the public utility sector associated with local activities, contributing an important role toensuring the implementation of local social security strategies and goals. Therefore, the equitisation and divestment must be conducted carefully, ensuring the correctness and adequacy of the enterprise value and not causing loss of State capital when equitising.

That is objective, from the subjective side, Minister DinhTien Dung said it is necessary to seriously consider and adjust to improve the quality and speed up the progress. In the implementation and implementation, ministries, sectors, localities, economic groups, and State corporations have not seriously implemented the plan of equitisation, divestment, and the restructuring of SOEs under the direction of the Prime Minister. The equitisation and divestment planning to submit to the competent authority for promulgation the list of equitisation and divestment is not close to reality. Along with that, the roles and responsibilities of the heads of enterprises and units are not high andnot drastic in the innovation of business activities. Most groups, corporations, enterprises do not actively implement the policies. State policy, until equitisation is required, they will begin to rearrange and handle real estate, thus greatly affecting the equitisation progress.

In particular, coordination between the owner's representative agency and the People's Committees of provinces, cities, ministries and branches concerned in implementing and approving the plan of real estate and real estate rearrangement per the Government's regulations has not been well done; the current progress is very slow, especially with real estate facilities in big cities like Hanoi and HCM City.

Another reason pointed out by the "commander" of the finance sector is that enterprises do not want to divest their capital in strongly developed industries and fields with high profit margins that make divestment progress slow, although it is clearly specified in the Prime Minister's criteria for classifying enterprises.

Expeditiously formulate a land use plan

To speed up the process of equitisation and divestment of SOEs in the last month of 2020 and 2021 as well as improve the efficiency of the equitisation, Minister DinhTien Dung emphasisedcontinuing to thoroughly grasp the views, the objectives, tasks, and solutions to reorganise, innovate and develop, and improve SOEs according to the guidelines of the Party, the National Assembly and the Government. The finance sector will also continue to advise all levels to improve the institutions and legal frameworks on the organisation, management and operation of SOEs on the arrangement of equitisation, divestment, and SOE restructuring in the direction of ensuring publicity and transparency according to the market mechanism. "Strengthening the practice of discipline, discipline and strictly handling wrongdoers, strictly handling those who are behind schedule", Minister DinhTien Dung emphasised.

Regarding specific solutions, recently, the Ministry of Finance has also proposed and proposed to the Government. In which, note: SOEs subject to equitisation need to urgently review the entire land fund that is being managed and used to make a land use plan in accordance with the land law and submit it to the People's Committees of provinces and cities. directly under the central Government to give opinions on the plan and land price for the competent authority to approve before determining the value of the equitised enterprise in accordance with regulations. In addition, the representative agency for the owners of State capital in the equitised enterprises by the end of 2020 has completed the determination of enterprise value, financial settlement, and enterprise value announcement in year 2020.

In addition, the representative agency for the owners of State capital in enterprises with State capital must withdraw capital in 2020 to deploy the divestment in accordance with regulations; promptly report to competent agencies for summing up and submitting to the Prime Minister for consideration and regulation cases of capital divestment facing difficulties and problems to adjust accordingly.

The Ministry of Finance also suggested that, for equitised enterprises, it is necessary to choose an appropriate time to sell shares for the first time and divest, not to sell shares or divest capital at any cost to ensure the right benefits of the State. In necessary cases, it is necessary to reduce investment spending from equitisation and divestment of enterprises to ensure the balance of the state budget.

For enterprises that have been equitised and converted to operate in the form of joint stock companies, it is recommended to make settlement of the equitisation; determine the amount to be paid/temporarily paid and submit to the support fund for arranging and developing enterprises according to regulations.