Vietnam to Reform State-Owned Enterprises for Bold Innovation

Vietnam is set to accelerate institutional reforms aimed at strengthening the competitiveness of state-owned enterprises (SOEs), which form the backbone of the national economy, and enabling them to play leading roles on the international stage. This move is a crucial step towards achieving the goal set by the Communist Party Central Committee to "foster SOEs that lead key industries and sectors, and emerge regionally and internationally." Experts emphasize the necessity of a more flexible and incentive-driven institutional design that allows SOEs to undertake bold investments and innovations without fear. Specifically, calls are being made for expedited decision-making, evaluation systems that encourage risk-taking, and delegation of authority for efficient resource allocation. Under Vietnam's one-party system, SOEs have been positioned as important pillars of economic growth. However, in recent years, issues concerning their efficiency and international competitiveness have been raised, and this reform is seen as an effort to strengthen cooperation with the private sector and transition towards more market-oriented operations. In particular, for SOEs to truly serve as "growth drivers" in Vietnam's rapidly expanding economy, they must possess the capacity to independently drive transformation and create new business models, rather than merely operating under strict control. The government intends to focus on developing an institutional framework that supports such "bold transformations" by SOEs.