Speaking at the conference on October 16, Deputy Prime Minister Vuong Dinh Hue said he had asked the Ministry of Natural Resources and Environment to amend the Government’s Decree 126/2017 guiding the execution of the Land Law regarding wholly owned SOEs subject to equitization.
However, the ministry has failed to complete this task for the past two years, resulting in delayed equitization, Hue noted.
He cited a case of the Vietnam Bank for Agriculture and Rural Development (Agribank) as a typical example.
The bank has completed the evaluation of its assets and has appraised its land use plans, he stated. However, the problem is the delay in the approval of its land use plan in HCMC, slowing the entire process of going public.
Bui Thi Thanh Tam, chairwoman and general director of Vietnam Northern Food Corporation (Vinafood 1), pointed out that the firm’s equitization plan may not be completed this year or the next due to problems with the land.
Tam confirmed that Decree 126 only requires the review of land plots owned by the holding company and two of its wholly owned SOEs.
However, the Ministry of Finance issued an official letter on land use plans related to equitization in April this year, ordering enterprises with at least 51% State capital to review their land and devise land use plans that must be approved before equitization.
The land of Vinafood 1 spans from the north-central province of Thua Thien-Hue to the northern provinces, totaling 25 localities with 246 plots where laborers have lived and farmed for a long time, making it difficult for local governments to easily take back the land.
“Many plots of lands have been subject to disputes since the 70s and 80s, so they could not be resolved immediately,” she said.
She also voiced concern over the assessment of land value at subsidiaries where the State holds a controlling stake.
In response to the issue, Deputy Prime Minister Hue noted that if necessary, appropriate adjustments to the official letter should be made.
Data from the Ministry of Finance indicated that as of the end of the 2017 fiscal year, there were 526 wholly owned SOEs. By end-September 2019, only 148 SOEs had been authorized for restructuring.
Nine SOEs were approved to go public between January and September this year, raising the total number of SOEs subject to equitization to 168, with a total value of more than VND443 trillion (US$19 billion), of which the State capital reaches over VND206 trillion (US$8.9 billion).
In the reviewed period between 2016 and September 2019, the State capital divestment hit VND24.51 trillion (US$1.05 billion), and the proceeds for the State were worth more than VND170.6 trillion (US$7.3 billion).