Vietnam metro to privatize 31 state-owned firms by 2015

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Vietnam Airlines are among state-owned groups being privatized

Ho Chi Minh City authorities have pledged to privatize 31 state-owned companies and either dissolve or sell 21 others over the next two years.

The city will privatize 14 companies this year and 17 more next year, news website thoibaokinhtesaigon reported Wednesday.

In its report sent to the government and the Ministry of Finance on December 25, the city said it failed to fulfill its goal of restructuring nine state-owned firms during 2013.

The reason, it said, was that enterprises were tardy in handing over their property for privatization and in finishing their administrative procedures to undergo construction, while some companies made key personnel changes, which slowed the process.

Pham Viet Muon, deputy chief of the government office, said the privatization of state-owned firms in HCMC has been too slow.

He said that from early 2011 to August last year, the city did not privatize any companies on the list of 31 state-owned ones slated for privatization.

A recent report by the HCMC's Corporate Finance Department showed that 93 out of 108 enterprises with a hundred percent state capital in HCMC had said their turnover as of the end of November last year was down 30.96 percent from 2012.

The report said the low turnover was due of the general economic slump, which has caused consumers to tighten their budgets, while the price of materials has gone up.

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According to the latest report by the Ministry of Finance about restructuring state-owned firms, by the end of last year, 6,376 state-owned companies had been restructured.

Fifty-seven percent of them have been privatized, 16 percent have been turned to single-member limited companies, 6 percent were sold, while 405 companies were dissolved and the rest were restructured in different ways, including mergers.

Eighty-three of 91 state-owned groups have had their restructuring plan passed, said the report. The other eight have not handed over their projects to be restructured.

The Ministry of Finance said most enterprises have become healthier due to the restructuring.

Among 3,576 firms that have been restructured, 85 percent have increased turnover, nearly 90 percent have seen their profits increase, and 86 percent have contributed more to the state budget.

But the Ministry said the process of restructuring state-owned firms is still too slow and the number of enterprises who have government ownership rates of more than 51 percent remains high.

In the coming time, it will cooperate with related departments to accelerate the process of restructuring and privatizing state-owned firms so that the project may be completed by 2015.

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