State management agencies have released a report about the ‘health’ of general corporations and economic groups, which, in Vietnam, lead the national economy. Many of the corporations and groups reportedly lost money and failed to fulfil production and business plans in the first six months of the year.
According to Pham Viet Muon, vice chair of the government office, many general corporations and economic groups faced big difficulties in the period.
The Vietnam Tea Corporation, for example, only fulfilled 38.3% of its yearly turnover plan, while the Vietnam Pharmaceutical Corp 38.9% and Ha Long Seafood Corp 36.3%.
Several general corporations have reported losses, including the Vietnam Airlines Corp (83.5 billion dong) and tea corporation (4.8 billion dong). Electricity of Vietnam (EVN) and PetroVietnam, two powerful economic groups, also did not fulfil production and business plans. EVN was slow in executing power projects. Meanwhile, PetroVietnam only fulfilled 95% of its six-month plan.
The Vietnam Coal and Mineral Industries saw illegal coal exploitation and exports, while the Northern and Southern Food Corporations, as they did not adequately prepare their food distribution system, could not take the initiative in controlling prices.
According to the Ministry of Finance, in 2007, a lot of general corporations and economic groups injected big sums of money, 57,078 billion dong (US$3,567 million), in subsidiaries. Moreover, they made capital contributions worth 34,482 billion dong (US$2,155 million) to associated entities, and made other long-term investments of 33,545 billion dong (US$2,096 million).
Also according to the ministry, state-owned enterprise restructuring has been going very slowly. In the first six months of the year, only 62 enterprises were restructured, while general corporations and economic groups equitised 17 member enterprises.
Nevertheless, general corporations and economic groups have gained a lot of recognised achievements. The total turnover of the corporations and groups, 519,119 billion dong (US$32,444 million), was equal to 60% of the yearly plan, an increase of 43% over the same period of 2007. The total pre-tax profit was 77,395 billion dong (US$4,837 million), fulfilling 52.4% of the yearly plan.
Most general corporations and economic groups seriously reviewed their investment portfolios, made important decisions to cut unnecessary investment projects or delay other investment plans. 55 corporations and groups cut 1,445 projects worth 33,591 billion dong (US$2,099 million), a decrease of 12.7% in value compared to their initial plans.