New mechanisms and policies needed for State-owned enterprises to grow
- 157
- Business
- 09:19 05/04/2022
DNHN - State-owned enterprises (SOEs) should have the same rights and obligations as other enterprises in the economy. And a policy reform is needed for enterprises to operate in line with the market mechanism and make decisions in a proactive and flexible manner like private enterprises.

The performance of SOEs has not seen marked improvement in recent years and is not commensurate with their resources while the restructuring process has been slower than expected. The reason lies in the drawbacks in the mechanism and policy on this economic sector.The concern shared by many SOEs is the gradual loss of their position in the market as their growth is trailing behind private and foreign-invested enterprises.
Lilama, for example, was a notable player in the market during the early 2000s as the general contractor of various hydropower projects, oil refineries and cement factories. The company’s annual revenue had reached over 20 trillion VND (875 million USD) at times, but the figure has now dropped to 4 trillion VND (175 million USD).
Lilama Chairman Bui Duc Kien explained that in the later years, there were not as many projects while the company had also overdiversified its investments, ranging from cement to electricity and banking. Such investments were not productive and Lilama had to divest and restructure.
Even the SOEs that are dominating the market are also worried about the road ahead if the management mechanism over SOEs is not reformed.
Viettel General Director Tao Duc Thang said the largest room for the company is now investing in start-up companies through venture capital funds, but all of its decisions are not as quick as those of private enterprises. When opportunities are available, private firms only take a month, or even a week, to sign contracts but it could take SOEs several months to complete all the procedures. As a result, SOEs find it very difficult to grow and are thus becoming smaller than private companies.
VNPT Chairman To Anh Dung shared that the telecommunications market is facing saturation and revenues of telecoms firms are going flat or even going down, so the new space for growth is in digital transformation. SOEs have not occupied a significant share in this field.
Amid the lightning-fast development of the market, VNPT has created a plan to restructure and asked for the government’s early approval so that it will have the opportunities to grow faster. Unlike private enterprises, which can invest in anything they find profitable, SOEs are only allowed to do what is right and risks are not accepted, so it is very difficult for them to innovate, especially in the IT field. Dung is expecting a new policy so that SOEs can promote their role in driving the economy, especially during this difficult period.
The biggest wish of SOE leaders is that they can operate as normal enterprises, by giving them the autonomy to do business on the basis of specific development orientations, tasks and goals. SOEs need to have clear property rights and should be monitored and assessed based on the general development goals, rather than specific projects or activities.
If so, SOEs must be regarded as having the full rights and obligations like other enterprises in the economy. Mechanism and policy reform is needed for SOEs to operate in accordance with the market mechanism and operate in as proactive and flexible a manner as private enterprises. This requires separating the function of representing owners from the function of enterprise management, thus reducing the intervention of owner representing agencies in the operation of SOEs that is happening now.
According to Vinatex Chairman Le Tien Truong, current policy inconsistencies are undermining the performance and competitiveness of SOEs compared to private and foreign-invested companies. He said that all matters must be presented to the owner for permission and in turn the owner must seek opinions from the relevant agencies. Such a process is time consuming and those who understand the market most are not allowed to make decisions to seize on the opportunities.
Aware of such drawbacks, the Ministry of Planning and Investment has suggested that ministries, agencies, localities and the Commission for Management of State Capital at Enterprises should change their working method and not intervene in the business administration of SOEs.
In addition, it is necessary to implement synchronous policies on wages aligned with labour productivity and business performance of enterprises, link SOE development with the strategy of economic sector development, and change the mindset and viewpoint on equitisation and disinvestment.
Once such measures are carried out, the development space for SOEs will be expanded and they will be driven to innovate and enhance the competitiveness of SOEs.
Source NDO
Related news
- Success in business is always a human story
- Mr. Le Viet Thang, CEO of 1Office: "Don’t use old solutions for new ai challenges"
- VinFast: a strategic pivot amid the green industry storm?
- 127 high-value projects post-merger: Ho Chi Minh City rolls out the red carpet for strategic investors
- Pakistani Ambassador to Vietnam: “Peace and unity are the strength to build the future.”
- Vietnam's Semiconductor Leap: Five Strategic Policies to Reach 2027 Goal
- What’s Vietnam’s game plan as President Trump pressures the Fed?
- SK Innovation and HD Hyundai (South Korea) step up cooperation with Khánh Hòa Province (Vietnam)
- Quang Tri attracts $96.5 mln in new projects in July
- A trade fair organizer surprises by joining the ranks of top-earning listed companies
- HDBank secures USD 215 million syndicated loan from JICA, SMBC, and FinDev Canada
- Samsung Electronics Vietnam inaugurates its first rooftop solar project at Bac Ninh Factory
- Promoting market development for science and technology products
- Sao Mai Group’s pangasius export segment embraces new opportunities
- Energy transition in Vietnam: Opportunities and challenges from coal power to renewables
- Renewable energy: Steering in the right direction of the times
- Clean energy must be protected by transparent, stable, and consistent policies
- European-standard ingredients: Inspiring culinary journeys from the heart of the kitchen
- The foundational mark of pioneers in renewable energy amidst an evolving legal framework
Đọc thêm Business
Success in business is always a human story
Those were the insights shared by Ms. Lirone Glikman, a global expert in strategic networking, in her conversation with Enterprise and Integration Magazine during her Asia tour and the launch of her book The Super Connector’s Playbook in Vietnam.
VinFast: a strategic pivot amid the green industry storm?
As the global auto industry accelerates its transition to electric mobility, VinFast faces its toughest test yet: soaring financial pressure, heated debates on phasing out combustion engines, and mounting global competition.
127 high-value projects post-merger: Ho Chi Minh City rolls out the red carpet for strategic investors
Ho Chi Minh City has unveiled a portfolio of 127 strategic projects as part of a major investment restructuring effort post-boundary expansion, signaling a shift toward selective and high-impact investment in technology, finance, and logistics.
Vietnam's Semiconductor Leap: Five Strategic Policies to Reach 2027 Goal
Vietnam has set an ambitious target: to manufacture "Make in Vietnam" semiconductor chips by 2027. This bold commitment marks a defining moment in the country’s high-tech trajectory, positioning Vietnam as a rising contender in the global chip race.
What’s Vietnam’s game plan as President Trump pressures the Fed?
In a move that rattled political circles and financial markets worldwide, U.S. President Donald Trump declared he would sue Federal Reserve Chairman Jerome Powell for “stifling growth” with high interest rates.
Quang Tri attracts $96.5 mln in new projects in July
The provincial authorities approved investment policy for 13 projects in the month of July.
Samsung Electronics Vietnam inaugurates its first rooftop solar project at Bac Ninh Factory
July 31, 2025, Samsung Electronics Vietnam (SEV) officially inaugurated the rooftop solar power project at the SEV factory in Yen Phong Industrial Park, Bac Ninh.
Promoting market development for science and technology products
The Trade Promotion Agency affirmed that it will continue close coordination with trade offices, domestic entities, and industry associations to effectively implement trade promotion programs tailored to science and technology products.
European-standard ingredients: Inspiring culinary journeys from the heart of the kitchen
The EU Good Food – Good Life campaign, funded by the European Union, has enriched the variety of EU-standard food ingredient options available in the Vietnamese market.
Taste of Queensland: Strengthening Vietnam–Queensland Partnerships through Culinary Diplomacy
Against the elegant backdrop of the “Taste of Queensland” networking dinner, government officials, business leaders, and investors from Vietnam and the Australian state of Queensland gathered to celebrate and advance a thriving bilateral relationship