There are a lot of reasons for this problem. For example, the institution and its legal documents have been changing continuously; experience and knowledge on SoE reform is still lacking. But at this time, the slow issuance of a document to replace decree 41/2002/ND-CP on regulations for workers on redundancy is one of the main reasons for the slow pace of SoE equitisation during the first quarter of this year.

SoEs are waiting for the next government decision on issues such as how to deal with workers who are made redundant when their businesses are equitised.

According to regulations under Decree 41, the decree expired on December 31, 2005. Was the Decree’s expiration planned in advance and were there any preparations for it?

It is true that there must be supplementary or continuous Document for Decree 41 at the time of the Decree’s expiration. In October, 2005, at a conference of the Committee, the Deputy Prime Minister Nguyen Tan Dung the Director of the Committee, decided to issue the Document but it is regretful that the relevant agencies carried out the Document’s provisions so slowly. According to the information we have, finishing touches are being added to the document and it will be released this month.

Are there many changes that will affect redundant workers?

There are some changes and supplements but for equitised enterprises, there is no change. For enterprises keeping the SoE model, they will have to deal with redundant workers by themselves without Government interference.

If it is so, do the changes affect worker’s benefits as well as the enterprise restructuring plan?

The Document based on the good points of Decree 41 will be an effective policy, appreciated by foreign researchers and supported by workers.

Up to now, there are 140,000 more redundant workers to get benefits from fund 41, worth VND5,000 billion.

To the benefit of workers at enterprises keeping the SoE model, the fund will come from enterprises. Therefore, the responsibility of SoEs in the rearrangement will be improved. The Government continues encouraging enterprises to join the equitisation process.

The establishment of economic co-operation also draws attention to enterprise equitisation. However, at the moment is there a comprehensive legal law for it?

No, there isn’t. Presently, some economic corporations are being set up for experiment. And there isn’t any legal law for them which asks the relevant agencies to continue with their studies. The model of corporations has existed in the world for a long time. In Viet Nam, the difference is that the corporation is controlled by the State, which leads to the wrong idea that the corporation is another bigger model of a company.

To me, law, economics, finance and staff in the corporation are different from the company’s. So it’s necessary to distinguish them.

In the past, corporations were formed simply by grouping smaller businesses together. Will Viet Nam’s economic group follow this path?

The parent-subsidiary model has become stable in the past 10 years. The big company can become a parent company when it has reached targets on products and business. The economic group developing in Viet Nam is different from the parent company model in terms of being a multinational business.

As planned, in 2006, the Committee will propose to set up seven to nine economic groups and I hope there is no mistake in forming these groups as those we committed when establishing corporations in the past.

But there is still worry about the State monopoly of these groups?

The group is always associated with monopoly. But the SoEs are abusing the administration right that the State gave them and their economic monopoly is very weak. In addition, it is a mistake to give the power of ministries and agencies to corporations.

Many economists are warning about corporation syndrome. What do you think about this term?

I think it is necessary to support companies who direct themselves to become corporations. In contrast, the trend of turning themselves into corporations to artificially raise the companies’ status needs to be criticised.

But there is almost no change in the management boards of corporations. Do you think there will be changes in the future?

For currently operating corporations, it is right that the structure is the same but at least, the management board has changed in their mind about management and business.

Source: Vietnam News 22/05/2006