SOE assets at 80% of GDP
The concentration of resources in the hands of State-owned enterprises (SOEs) allegedly created barriers to reforms, said experts from the Central Institute for Economic Management (CIEM).
A report by the institute revealed that the total assets of SOEs had reached VND2.8 quadrillion (US$129.63 billion), equivalent to 80% of the country's gross domestic production (GDP).
The scale of SOEs' total assets versus the economy was too high compared with global levels, Pham Duc Trung, deputy head of the Research Department for Enterprise Reform and Development Policies, said at a conference on May 27.
He cited statistics showing that the public sector's assets were equivalent to only 15% of the GDP in Africa, 8% in Asia, 6% in Latin America and 15% in member states of the Organisation for Economic Co-operation and Development.
Trung stressed that the concentration of resources in the hands of SOEs had caused the economy to suffer. He pointed out that a group of SOEs still enjoyed advantages and privileges, such as gaining access to credit or land use approvals easily.
"Many State economic groups are controlling important markets, such as power generation and petrol, while business conditions have been manipulated to make it difficult for private firms to enter such markets," Trung said.
Of note, most of the economic resources—some 60% of the total assets owned by SOEs—were held by a dozen SOEs, making them "too big to fail."
CIEM's director Nguyen Dinh Cung said a review of the roles and functions of SOEs was fast becoming an urgent issue, noting that this job would not be easy.