Vietnam’s Opportunities and Challenges for Investors

For years, Vietnam has aimed to reduce its direct ownership in key state companies and promote private ownership. Nevertheless, equitization and divestment have not yet taken place as scheduled and have experienced constant delays.

According to the Ministry of Finance (MoF), from 2016 to 2020, 180 state-owned enterprises (SOEs) were equitized. However, this included only 39 out of 128 enterprises on the list approved by the Prime Minister, meeting only 30 percent of the target. In 2021, three SOEs were equitized, but none were on the list approved by the Prime Minister.

Regarding the initial sale of shares, the total selling value was VND22.7 trillion (US$987 million), or 23 percent of the plan. For 2016-2020, the MoF said VND177.4 trillion was collected through divestment, about 6.5 times the book value. 

Last year, only three SOEs completed the privatization…