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PM approves master plan on economic restructuring

VGP – PM Nguyen Tan Dung has just approved the Master Plan on Economic Restructuring in 2013-2020, which focuses on reorganizing public investment, credit organizations and State-owned enterprises.

February 22, 2013 9:18 AM GMT+7

The Plan aims at perfecting the socialist-orientated market regime, creating a system of reasonable, stable and long-term stimuli, especially tax incentives and other investment-encouraging measures, promoting the distribution and use of social resources for sectors and products of competitive advantages, improving labor productivity and competitiveness.

Under the Plan, a favorable and stable macro-economic environment will be maintained, in which monetary policies will be realized effectively and carefully; their instruments exploited flexibly in close combination with fiscal policies in order to curb inflation, secure macro stability and a sound growth rate in line with the country’s specific socio-economic conditions in certain periods.

The Government will boost export while developing supportive industries and production of domestic consumer goods.

At the same time, it is necessary to further control price and market and maintain the supply-demand balance of primary goods.

Renewing distribution and use of capital

The Government plans to mobilize different resources for development investment, so that the total investment accounts for 30-35% of GDP and State investment holds 35-40% of the total investment. About 20-25% of total budget spending will be spent on development investment.

The Government will manage to maintain key economic elements at reasonable rates, especially savings, investment and consumption, state budget, balance of trade, international balance of payments, public debts and national foreign loans.

Scope and opportunities will be expanded for private investors who are encouraged to jump in infrastructure, potential industries and products, and key economic zones.

Clearing bad debts

In the period of 2013-2015, the Government will concentrate on making credit organizations’ financial status more healthy by clearing their bad debts, developing major business activities, securing liquidity and sustainable development, and increasing transparency in operations of these organizations.

The system of credit organizations will be reorganized so that by 2020, it is possible to develop a network of modern multi-functional credit organizations which can operate safely and effectively.

In the time to come, the Government will review and categorize joint-stock commercial banks, financial leasing companies and other credit organizations while closely monitoring the design and realization of approved restructuring plans of credit organizations.

Reorganizing State-owned enterprises

State-owned enterprises (SOEs) will be classified and reorganized. Equitization will be promoted in SOEs where the State’s full ownership is unnecessary.

SOEs should concentrate on military industries, monopoly industries, provision of primary goods and services, and high technology sectors.

Each and every SOE must restructure their investment and business activities, focusing on main ones. They need also to make divestments from sideline fields and joint-stock companies in which the State is not necessary to be the dominant shareholder.

The Government will continue to raise quality, effectiveness and competitiveness of private enterprises; encourage the establishment and development of powerful private economic groups which can compete on domestic and foreign markets.

The PM required Ministers, leaders of ministerial-level agencies, and Chairpersons of provincial-level People’s Committees, within their competence, to promptly design and implement action plans on restructuring within the first half of 2013.

By Hong Hanh