VietNamNet Bridge – Vietnam once missed the opportunity to reform its state owned enterprises (SOEs) when joining WTO. Another opportunity has come when it negotiates for the Trans Pacific Strategic Partnership Agreement (TPP).

The last TPP round of negotiation was kicked off on December 7 in Singapore. Prior to that, seven conferences within the framework of TPP negotiations were held consecutively within one month, from October 28 to November 24.

While the majority of the problems have been settled after the conference, some others remain controversial, including the businesses’ market access, the role of SOEs and intellectual property.

The TPP member countries, in a statement released on the sideline of APEC conference in Bali, Indonesia in October, affirmed that considerable progress has been made in all sectors and that existing problems would be settled by the end of the year.

However, Vietnamese Deputy Minister of Industry and Trade Tran Quoc Khanh, Head of the Vietnam’s TPP negotiation delegation, thinks that it would be possible for the members to obtain basic agreements after the conference in Singapore. However, a complete draft agreement to be inked may not be ready by the end of the year.

What’ll happen with SOEs?

The TPP’s approach to the issues of SOEs and public procurement remains the biggest problem for Vietnam, though, as the US Ambassador to Vietnam David B. Shear said, the TPP’s provisions come in line with Vietnam’s policy on the economy restructuring, including the SOE restructuring.

Deputy Head of the Central Institute for Economic Management (CIEM) Vo Tri Thanh, noted that TPP and the agreements Vietnam is negotiating to join bring the great opportunities to Vietnam to implement the SOE restructuring program.

However, Thanh said SOEs remain reluctant to join the progress, merely because TPP requires the equal treatment to all economic sectors with no privilege for SOEs.

Pham Chi Lan, a former Member of the Prime Minister’s Research Team, a well- known economist, noted that the SOE restructuring progress has been going very slowly with no clear direction.

While the government many times affirmed its strong determination to carry out the SOE reshuffle, the achievements remain very modest. Only 25 SOEs have been equitized so far this year.

It is still unclear if Vietnam, with TPP, would try to grab the opportunity to accelerate the process towards the transparency and fairness to all economic sectors.

No driving force and pressure for SOE restructuring

Commenting about the SOE restructuring process in Vietnam over many years, Chair of the National Assembly’s Economics Committee, noted that SOEs cannot see the driving force and feel the hard pressure to go more quickly with the restructuring plan.

Five TPP member countries, including the US, Canada, Japan, Australia and Mexico have agreed to give the grace period of five years for Malaysia, Peru, Brunei and Vietnam to adjust their policies relating to SOEs.

It is now obvious that Vietnam won’t miss the “TPP boat.” However, it is still clear if it can reshuffle the SOE system or, once again, would go aground like it did with the “WTO boat”.

Thanh Mai