Vietnam's state capital management 'super commission' to cease operation

Vietnam's Commission for the Management of State Capital at Enterprises (CMSC) will end its operations soon and transfer the management of 19 state-owned groups and corporations back to relevant ministries.

The CMSC, which oversees seven major state-owned enterprises with a combined market capitalization of VND515 trillion (nearly $21 billion), will be remodeled to become an organization directly managed by the government.

The changes were stipulated in a document outlining the government's plan to restructure and streamline its administrative apparatus, signed by Permanent Deputy Prime Minister Nguyen Hoa Binh on Friday.

As part of the restructuring, major groups and corporations such as Petrovietnam (PVN), Vietnam Electricity (EVN), telecom giant VNPT, mining group Vinacomin, Vietnam Railways Corporation (VNR), and Vietnam Expressway Corporation (VEC) will have their Party organizations transferred to the government’s Party Organization.

The State Capital Investment Corporation (SCIC), which represents the state’s ownership in these enterprises and holds 10% of Vietnam's total stock market capitalization, will end its functions and be put under the management of the Ministry of Finance and other relevant ministries and agencies.

In his address at the CMSC's year-end conference for 2024, Deputy Prime Minister Ho Duc Phoc emphasized the need for the restructuring to be completed quickly, ideally by February 25, 2025. "The committee must carry out the task in the most scientific and efficient way, avoiding any disruptions of work," he stated.

Established in 2018, the CMSC, a government agency, is responsible for managing state-owned capital in companies where the state holds 100% of the equity, or in joint stock and limited liability companies with state investment.

According to Nguyen Ngoc Canh, vice chairman of the commission, the equity and consolidated assets of its 19 groups and corporations have significantly increased compared to 2018, when these enterprises were transferred from ministries to the CMSC for management.

The total equity of these "giants" now stands at VND1,180 trillion ($46.48 billion), an 11% rise over the past five years. Their total assets reach VND2,540 trillion ($100 billion), accounting for 65% of the total assets of all state-owned enterprises across the country.

Over the past five years, these enterprises have contributed VND1,280 trillion ($50.4 billion) to the state budget, or an average of 10-12% of the total state budget revenue each year.

The firms reported a combined revenue of VND2,031 trillion ($80 billion) in 2024, reaching 120% of the year's target and 107% of last year’s figure.

Their pre-tax profit was estimated at VND111.7 trillion ($4.4 billion), surpassing the year's plan by 58% and up 56% compared to the same period last year.

Their state budget contribution totaled VND206.2 trillion ($8.12 billion), equivalent to 153% of the year's plan and up 5% year-on-year.