Avoid asset loss when equitizing state-owned enterprises

(Baonghean) - At the conference on implementing the task of restructuring state-owned enterprises (SOEs) in the 2014-2015 period recently held in Hanoi, the Prime Minister affirmed that the key task of the Government in the next 2 years is to restructure SOEs and promote equitization.

The target is to complete the equitization of 432 SOEs. And a strong message was sent by the head of the Government with the statement "Anyone who hesitates in restructuring and equitizing SOEs should be asked by the Minister to do other work, not to be promoted to a higher position". This demonstrates the Government's determination to carry out equitization and also shows that equitization is a fundamental and important part of restructuring SOEs.

Equitization is the most important task in restructuring state-owned enterprises to create a foundation for state-owned enterprises to have a more reasonable structure, focus on key and core sectors and fields for the state economy; improve competitiveness and profit rate on equity, and fulfill assigned responsibilities well. Therefore, we must speed up the equitization progress to achieve the set goals by all means. However, equitization should not be done at all costs to ensure progress. And accelerating the equitization of a large number of state-owned enterprises in such a period of time raises concerns about the loss of state assets. In fact, in Eastern European countries, after the equitization of state-owned enterprises, a large amount of national assets fell into the hands of a few individuals, making them famous billionaires in a very short time. In our country, in the early 90s of the last century, nearly 4,000 state-owned enterprises were equitized and many state assets fell into the hands of a group of people. Typical examples are the Golden Land of Trang Tien Ice Cream or Phu Gia Hotel in Hanoi, whose real value is up to thousands of billions of VND, but when the shares are only worth a few tens of billions of VND and fall into the hands of a few individuals.

Of course, all steps of the equitization are considered to have been carried out “correctly” and legally. There are many tricks for people to transform public property into private property through equitization. But the easiest and most common way is to value assets before equitization much lower than their real value. And it is very cleverly hidden under the form of public bidding, but in fact, the same group splits into two and plays the “blue team, red team” game with each other. After a few roundabout operations, the land, assets, and machinery return to the hands of those with influence in the enterprise. Not to mention that every SOE has intangible assets including brands, relationships, business reputation, and signed agreements. However, those valuable things are often not fully listed in the asset summary table and, if they are, they are valued very inaccurately, much lower than their real value.

So, once again, state assets continue to fall into the hands of someone. State-owned land is also a type of asset that is easily undervalued by applying the price list of land announced by localities. And this type of price is always much lower than the market price or only calculating the land rent paid to the budget. This is another loophole for people to easily appropriate state assets. In the near future, there will be a series of famous state-owned enterprises with huge amounts of intangible and tangible assets that will be equitized such as Vietnam Posts and Telecommunications Group, Chemical Group, Bank for Agriculture and Rural Development, Paper Corporation, Northern Food Corporation, Southern Food Corporation, Cement Corporation, Northern Power Corporation, Central Power Corporation, Southern Power Corporation...

In addition, a series of enterprises in the construction sector are also subject to equitization. If there are no effective preventive measures, the amount of state assets lost after equitization will be very high. And the most effective and feasible measure to prevent this situation is to be open and transparent in declaring and valuing assets. Along with the active and determined participation of the State Audit, the close supervision of internal affairs, judicial and inspection agencies. Only by doing so can the risk of loss of state assets during equitization be minimized.

Duy Huong