Private firms need fairer treatment: Minister

In the weekly show ‘People ask, ministers answer’, Minister of Planning and Investment, Bui Quang Vinh, said that several problems including the monopoly of SOEs’ and opportunities for private firms must be quickly addressed.

Minister of Planning and Investment Bui Quang Vinh

It is said that Vietnam’s past development depended heavily on public investment and the exploitation of natural resources. These resources are being exhausted and more tightly controlled. What is the best course for managing these resources in the next year?

It’s sure that we’ll still have to depend on natural resources and state budget to achieve the GDP growth goals of 5.8% in 2014 and 6% to 6.2% in 2015. But we’ll carry out reforms and restructuring processes in order to create a better legal framework to encourage private firms to make investments in public services and infrastructure.

Experts have said that FDI firms contribute much more than domestic private firms. For example, FDI firms contributed USD15.4 billion out of a total of USD15.5 billion made by mobile phone and spare parts exportation. What do you think about this problem and does it affect our sustainable development?

We shouldn’t discriminate against FDI firms because they must follow all our laws when doing businesses here. They bring in capital, make investments and pay taxes just like everyone else. They also create a jobs and profits in this country.

The matter is how we can improve our domestic firms so that they are able to achieve the same success. We can speed up the process of buying bad debt so firms can create clearer development plans and access low interest loans. I think all private firms must be given fair access to our resources instead of seeking guarantees and protection from the state. On the other hand, domestic firms must work harder.

Vietnam has been experiencing low labour productivity, while the four-year recession has prevented many firms from beginning new projects. What can we do in the next year to solve these problems?

Banks do have excess capital for loans but firms must deal with bad debts before they can gain access to it. Moreover, firms need to rethink their directions and the marketability of their products in changing times to improve their ability to compete. One of the solutions lies in technology. Let’s take Samsung for example, they use less steel and spare parts, but make high profits while we used a huge amount of those materials for smaller returns.

Currently, it seems like the state-owned enterprises have monopolies in many sectors. Can you tell what sectors will be privatised in the future?

Except for some sectors related to national security and sensitive industries such as explosives and toxic products, everything else is and will be a fair game.

According to our current schedule, by 2015 we’ll equitise many state-owned firms and keep only about eight groups. But in fact, those eight groups’ member companies will be equitised anyway.  There are also some of the opinion that the state should sell all its stakes in Vinamilk as well as other beverage groups, but not all agree.

Concerning long-term development, we have to create new legal framework so that firms have a easier access to capital and other resources.

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