Restructuring State-owned Corporations and Holding Companies

On February 5, Prime Minister Pham Minh Chinh chaired a working conference with the State Capital Management Committee (Committee) and 19 groups and state-owned corporations to implement production and business plans for 2024 and promote investment for economic and social development.

Before-tax profit reached VND 53,256 trillion

Deputy Chairman of the Committee Ho Sy Hung said that in 2023, the total revenue of the parent company of 19 groups and state-owned corporations reached nearly VND 1,135 trillion, equivalent to 105.15% of the 2023 plan. Before-tax profit reached VND 53,256 trillion (excluding Vietnam Electricity Group – EVN), equivalent to 166.09% of the 2023 plan and 110.92% compared to the same period in 2022. The groups and state-owned corporations contributed over VND 79,252 trillion to the state budget, equivalent to 199.96% of the 2023 plan and 120.22% compared to the same period in 2022.

In 2023, 15 out of 19 groups and state-owned corporations completed and exceeded their revenue targets; 16 out of 19 groups and state-owned corporations completed and exceeded their pre-tax profit targets (with Vietnam Airlines reducing losses compared to the plan); 16 out of 19 groups and state-owned corporations completed and exceeded their state budget contribution targets.

It is noteworthy that the Committee, together with the groups and state-owned corporations, made efforts to overcome difficulties and obstacles to implement many investment projects in energy and transport infrastructure in 2023, including many large and important projects that had been delayed for many years. Specific projects include: Construction of Ben Luc – Long Thanh Expressway; Thị Vải LNG Import Warehouse with a capacity of 1 million tons; Construction of Container Terminal 3 and Terminal 4 of Hai Phong International Gateway Port; Component Project 3 – Phase 1 of Long Thanh International Airport; Construction of Passenger Terminal 3 – Tan Son Nhat International Airport; Expansion of Terminal 2 – Noi Bai International Airport; Construction of Terminal 2 – Phu Bai International Airport (completed and put into operation since April 28, 2023), expansion of Dien Bien Airport…

At the conference, Chairman of the Supervisory Board of Northern Food Corporation Bui Thi Thanh Tam said that Vietnam has reached Government-level agreements on rice trade with Indonesia and the Philippines – the two largest rice importers of Vietnam. Immediately after that, in the last days of January, Vietnamese businesses overwhelmingly won about 350,000 tons in the bidding package of 500,000 tons of rice from Indonesia.

Having significant resources should be profitable

In conclusion, Prime Minister Pham Minh Chinh acknowledged and praised the contributions of the Committee, the groups, and the state-owned corporations to the achievements and overall results of the country in 2023, especially in terms of GDP growth, business administration, and particularly ensuring social security.

However, the Prime Minister demanded an absolute dissatisfaction and complacency with the achievements and results that have been achieved. The Prime Minister pointed out the existing limitations and constraints in the activities of the groups and state-owned corporations, such as issues related to mechanisms, policies; limited investment for development, the rate of disbursement of public investment is lower than the national average; contribution to GDP growth is not commensurate with the resources held; business investment efficiency is not high. “The groups and state-owned corporations, which have significant resources, must operate profitably and contribute even more to GDP growth and the state budget. The requirements for 2024 for the whole country and for the groups and state-owned corporations are to achieve higher results than in 2023” – the Prime Minister assigned tasks.

The Prime Minister also mentioned efforts to overcome the weaknesses of specific cases, such as the 500 KV line of EVN, which has not been implemented for many years but is now being vigorously constructed and is expected to be completed within 6 months. Or after a period of difficulties, PVN is now operating with positive results. The Airports Corporation of Vietnam, which has been stagnant in previous years, has made many changes, especially in the construction of Long Thanh Airport. The Vietnam Railway Corporation, after years of losses, has had effective innovations and made a profit in 2023; developments in the implementation of the Lot B – O Mon gas projects after decades of delays…

The Prime Minister cited the example that in 2023, the Government directed to increase rice exports while prices were increasing, there were also concerns in the complex world situation. “The life cycle of rice plants is currently only about 3 months, rice reserves are guaranteed, we need to take advantage of the opportunity to export. The result is that we have not only exported rice to a record extent but also ensured a balance of food domestically, and contributed to ensuring global food security” – said the Prime Minister.

Avoid pushing and avoiding

To further enhance the effectiveness of the activities and investment resources of the groups and state-owned corporations in implementing the economic and social development plans in 2024 and the coming period, the Prime Minister clarified some key contents on management principles, leadership, and major tasks with the activities of the Committee and the groups and state-owned corporations in the coming period.

Accordingly, grasp the actual situation, concretize it into effective programs, projects, organize the implementation effectively. Focus on amending and proposing competent levels to amend laws, decrees, circulars related to removing obstacles, difficulties in legal matters, especially those related to the fields of prices, environment, resources, land. “The spirit is that decentralization and empowerment go hand in hand with appropriate allocation of resources, enhancing implementing capacity, strengthening inspection and supervision” – the Prime Minister emphasized.

Especially, the Prime Minister requested to focus on promoting investment and development, overcoming limitations in this issue, investing with a focus, concentration on 3 strategic breakthroughs of the country (institutions, human infrastructure), revitalizing the 3 old growth engines (investment, export, consumption) and supplementing new growth engines (digital transformation, green transformation, circular economy, knowledge economy, sharing economy)… At the same time, restructuring the groups and state-owned corporations according to approved plans, focusing on 3 restructuring contents: Restructuring in a governance direction that is effective and efficient, raising the quality of human resources; financial restructuring; restructuring in industries, inputs… in a manner suitable to development trends.

The Prime Minister noted that the Committee must focus on orienting the restructuring issue for the groups and state-owned corporations and evaluating the activities of businesses based on overall efficiency. Strengthen decentralization, delegation of authority, streamline administrative procedures, be more proactive, make full use of the spirit of strong attack, determination, confidence, dare to think, dare to do, dare to take responsibility in the implementation of tasks under jurisdiction, adhere to the principles but be flexible in implementing specific tasks, comply with market economy laws.

The Prime Minister believed that the ministries, branches, and the Committee have more experience and must work closely, effectively, quickly solve and respond to proposals from the business community with the spirit of all for the common interest, the national interest, for the development of the groups and state-owned corporations; not push, avoid, not inconvenience, distract, and work together with businesses in overcoming difficulties and challenges.