SOEs invest more than US$12.6 billion abroad during 2011-16

Monday, 2018-05-28 17:08:37
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SOEs invested in 110 overseas projects, with a total registered investment of more than US$12.6 billion during 2011-16. (Photo for illustration)
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NDO – There were 18 State-owned enterprises (SOEs) investing in 110 projects abroad, with total registered capital of US$12.6 billion as of December 31, 2016, according to a report delivered to the National Assembly (NA) on May 28.

The report, compiled by the NA specialised team to supervise the management and use of State capital and assets in enterprises and SOEs equitisation during 2011-2016, was presented by the Chairman of the NA’s Economic Affairs Committee, Vu Hong Thanh.

According to the report, as of December 31, 2016, the nation had 583 enterprises fully owned by the State. Most enterprises posted profits which increased year after year, with combined revenues reaching VND1.5 quadrillion (US$66 billion) in 2016, and pre-tax profits near VND140 trillion (US$6.1 billion), thus basically fulfilling their role as an important force of the economy, contributing to regulating and stabilising the macro-economy.

However, the supervision team said despite high growth in total assets and capital, increases in revenues, pre-tax profits and contributions to the State budget were sluggish at an average of 3% a year. Meanwhile, total debts remained high, rising 26% against 2011.

Chairman of the NA’s Economic Affairs Committee Vu Hong Thanh. (Photo: Quochoi.vn)

According to Thanh, the investment is still spreading with limited efficiency in subsidiaries and affiliated companies, negatively affecting the financial capacity and efficiency of state capital use in SOEs.

He suggested the Government take measures to improve the quality of management and use of funds to support the reorganisation and development of enterprises. The use of revenues from equitisation and divestment should focus on key national infrastructure projects to create long-term resources.

In addition, there should be a mechanism to supervise, inspect, and evaluate the performance of organisations and individuals that exercise the rights, obligations, and responsibilities of the representatives of state capital in enterprises, Thanh added, stressing the need to handle violations in the management and use of state capital and assets in enterprises, as well as during the equitisation of SOEs.

Furthermore, according to Thanh, transparency must be increased for all SOEs in accordance with the standards applicable to public companies, along with the establishment of a national data on SOEs and sanctions to ensure effectiveness in coordinating management and arrangement of enterprises among concerned ministries, sectors, and localities.