Hanoi (VNA) - Deputy Prime Minister Vuong Dinh Hue urged the State Capital Investment Corporation (SCIC) to strengthen operationℱs for more effective use of State assets during a working session in Hanoi on April 26.

SCIC is a strategic investment arm of the Government. Its assigned task is to manage the State’s interests in companies and projects, aiming to strengthen the dominant role of the State sector while respecting market rules. Since the corporation began operations 10 years ago, it has disbursed capital worth more than 24.3 trillion VND (1.1 billion USD) for investments in key sectors and essential industries, according to a SCIC report. It currently manages enterprises that work in financial services, energy, manufacturing, telecommunications, transportation, consumer products, health care and information technology. It gave out nearly 8.5 trillion VND, or more than 30 percent of the total disbursement, during the last two years alone. The company reported average annual growth rates of 56 percent for turnover, 31 percent for ownership capital and 36 percent for total assets. Its after-tax profits grew by 56 percent on average per year, and its financial contribution to the State budget has nearly doubled each year. The establishment of SCIC has been seen as a bold move by the Government during the height of economic and State-owned-enterprise (SOE) reforms, which aimed to reduce the burden on the State budget. Hue said the company should consolidate its organisation by applying international management standards, improving human resources and ensuring efficiency in internal supervision. He asked the company to closely track Government directives in divesting from SOEs and investing in strategic areas, such as start-ups involved in new high-tech products. He said the Government expected the firm to become a major financial group that helped enhance the efficiency of the domestic economy and integrate it into the international market. Vietnam News reported earlier this year that SCIC would increase investments in 2016 through participation in initial public offerings of economic groups, as well as business mergers and acquisitions. In 2015, it earned more than 8.4 trillion VND in pre-tax profits, exceeding the yearly plan by 36 percent. Its return on equity was 25.6 percent last year, 1.6 times higher than the annual target. As of December 30, 2015, the company represented the State’s shareholding rights in 230 enterprises. It held stakes of 30 percent to more than 50 percent in many large companies, such as Vinamilk, FPT Telecom and Bao Minh Insurance Corporation. On April 25, Hue also urged the National Financial Supervisory Commission (NFSC) to intensify its capacity in macro-condition forecasts to give the government timely advice on running the economy. He asked the agency to collaborate with the Ministry of Planning and Investment to figure out measures to accelerate economic growth and assure economic stability. He also asked the commission to coordinate with the Ministry of Finance and the State Bank of Vietnam to study policies to guarantee public debt security and handle bad debt, and restructure the financial market in balance with monetary policies. The focus should be on reorganising credit institutions, and stock and insurance markets, he said.-VNA