Need for specific mechanisms for key corporations in the economy

Dr. Le Dang Doanh, former Director of the Central Institute for Economic Management, had an interview with reporters about the specific mechanisms that need to be added to the Draft Law on Management and Investment of State Capital in Enterprises, in order to meet the requirements of the new context.

PV: In the context of many changes in the socio-economic situation, do you think it is necessary to rearrange the fields of state-owned enterprises to suit the new situation?

Dr. Le Dang Doanh : The 4.0 industrial revolution, digital economy, e-commerce, robots, artificial intelligence (AI) lead to changes in the position and importance of economic and technical sectors in the economy and competitiveness. Digital services, work, education, and remote learning are developing strongly. Therefore, it is necessary to analyze and redefine which sectors and fields need to maintain state-owned enterprises, which sectors need to attract investment from the private economy and foreign investment to take advantage of this opportunity.

In particular, the role of the National Assembly and the Government is to specifically announce the list of sectors and industries in which the State needs to invest, supplement capital or divest capital after reassessing the context of the 4.0 Industrial Revolution leading to changes in the position and importance of economic and technical sectors.

Clearly distinguish between security, defense, and public interest tasks and business tasks, regulate information reporting, and transparency of defense and security enterprises, and implement supervision by competent authorities over state-owned enterprises.

Determine the role of State-owned enterprises in the current economic situation and for each economic region, such as in industrial centers with many foreign-invested enterprises and private enterprises, which is different from remote areas where there are not many private enterprises operating.

In the current conditions, when the private economy has developed more, state-owned enterprises do not need to hold all fields, but only need to hold necessary positions in sectors related to national defense - security and certain economic - technical sectors where the private economic sector and foreign investment are not ready to invest.

State-owned enterprises need to play a dominant role in a number of industries and sectors, especially in the areas of creating infrastructure for growth, energy, credit finance, banking, telecommunications, food exports, and airport services.

In addition, in remote areas, islands... where the private economy and foreign investment are not ready to invest and do business, state-owned enterprises still need to be maintained to ensure regional economic development.

Therefore, promoting the restructuring of state-owned enterprises combined with new investment in necessary areas for the state economy to truly play a key role in the socialist-oriented market economy. This involves both restructuring and reducing state-owned enterprises and selectively investing in state-owned enterprises in necessary, advanced areas of science, technology, and national security and defense.

State-owned enterprises need to play a dominant role in the fields of infrastructure creation, energy, credit finance, banking, telecommunications, food export, and airport services (Illustration photo)

PV: In the new context, there are many problems arising for state-owned enterprises/corporations that play a leading role in the economy. In your opinion, what mechanism should be built so that these enterprises can fulfill their missions as expected?

Dr. Le Dang Doanh : From the need to rearrange and redefine the role of State-owned enterprises in the new context, it is recommended that the Government decide on a number of contents, in order to create a legal corridor so that the Government has the authority to issue a list and specific mechanisms for corporations playing a leading role in the economy.

Firstly , it is recommended to add the content "The Government decides on a specific list of enterprises that play a leading role, hold key positions in the economy, and manage important national infrastructure in each period. The Government issues the Charter and Regulations on financial management of these enterprises".

Second , regarding additional capital investment , it is recommended to add the following content: “ For enterprises with direct State capital investment that play a leading role, hold a key position in the economy, and manage important national infrastructure, the transfer of State capital invested in enterprises with direct State capital investment under the management scope of the capital owner representative agency must be reported to the Prime Minister for decision, comments, or implementation according to the restructuring, arrangement, and reorganization project approved by the Prime Minister.”

One point to note is that the law should only stipulate the objectives and principles for evaluating State-owned enterprises and enterprises in general, and the Government should be responsible for specifying the criteria and norms because these criteria depend on the market context, development goals... which change over time.

Enterprises are responsible for business results, salaries, and bonuses according to industry standards and guidelines in each stage of the development strategy. The State regulates by collecting corporate income tax and personal income tax.

Unify regulations on transparent disclosure of business information of enterprises in accordance with international practices, unify forms, time, and location of disclosure on electronic information portals, avoid overlaps and duplications between Law 69/2014/QH13, the Law on Enterprises, the Law on Securities, between the Information Portals of the Ministry of Finance, the Ministry of Planning and Investment, etc.

In addition, the completion of the content, procedures for approving investment projects, and the investment decision-making authority of the owner's representative agency in cases where the Prime Minister is authorized to make decisions in Law No. 69 for national key projects, large projects and public investment projects to ensure compliance with the provisions of the Investment Law, Public Investment Law... aims to solve difficulties for enterprises in determining the governing body and decision-making authority for these projects.

Reporter: In order for the State to play a good role as a legal "midwife" for State-owned enterprises, how should the mechanism for State capital management and investment in enterprises be innovated, sir?

Dr. Le Dang Doanh: Promoting innovation activities in enterprises in general and state-owned enterprises in particular is an urgent requirement today. Because innovation is the shortest path to growth and development, in which enterprises are the center of the innovation process as an inherent need, the State plays the role of a "midwife" providing legal support.

The State focuses on effectively and synchronously implementing mechanisms and policies to encourage enterprises, especially financial support policies to promote enterprises to implement technological innovation activities and improve technological management capacity. Focus on organizing training on technology management and updating new technologies for enterprises. Strengthen training and updating knowledge on technological innovation for enterprise managers.

The State also plays a role in supporting enterprises in research, trial production, application of advanced technology, training, hiring experts to design, produce new products and change technological processes. Establishing science and technology business incubators to conduct research and apply the production of new products.

Along with that, the State also continues and resolutely promotes equitization and divestment of non-core investments of State-owned enterprises. To do this, it is necessary to soon promulgate the Law on Equitization, policies on dividends, profits from investment capital in State-owned enterprises and contents on equitization of State-owned enterprises.

The principle is to ensure publicity and transparency in the operations of state-owned enterprises on the basis of compliance with market principles, creating equality between state-owned enterprises and non-state enterprises.

Phuong Thao

Source: https://www.pvn.vn/chuyen-muc/tap-doan/tin/1200aee2-697b-4b30-bc25-5e5c23ebc8b0