A view of Ho Chi Minh City (Source: VNA)HCM City (VNA) - Prime Minister Nguyen Xuan Phuc hasgreen-lighted Ho Chi Minh City’s proposal to spend 67 trillion VND (almost 3billion USD) raised from equitisation of State-owned companies and sale oftheir stakes in non-core business for social development.
“HCM City plans to spend the money on medium- and long-term publicinfrastructure and social projects in 2016 –20,” Pham Phu Quoc, General Directorof the HCM City Financial and Investment State-owned company (HFIC), told theGovernment website baochinhphu.vn.
During the period, the city is expected to need 850 trillion VND (37.5billion USD) for social development, but is prohibited from mobilising fundsfor fear of breaching the permitted public debt limit.
With the current debt level, the city can only mobilise another 70percent of this year’s budget from issuance of bonds and the like.
“The money is small compared with the need,” Quoc said.
“Therefore, the 67 trillion VND package has much significance forthe city’s development.”
The Prime Minister has also permitted the HFIC to represent thecity in businesses where it owns stakes.
But questions have been asked if money raised from equitisationshould not go into the Business Development and Support Fund first and aboutthe legality of appointing the HFIC to manage the money and represent the cityon the boards of companies.
Quoc dismissed these concerns, saying, “It is in line with articleNo. 13 in the 2015 State Budget Law.”
The law says “Local money, which is recouped from economicorganisations, shall remain at the local level.”
This model has been run on a pilot basis since 2010 and isconsidered a success.
“HCM City has sent a report to the Prime Minister about the modeland confirmed that HFIC has successfully completed its task of safeguarding anddeveloping State capital resources,” Quoc said.
Tran Vinh Tuyen, Vice Chairman of the municipal People’sCommittee, said: “Leaders and experts spent a lot of time to establish theHFIC. The corporation operates as a business and the HCM City People’sCommittee directly manages it.”
The strength of the model lies in professionalising the role ofthe representative of State capital in businesses by applying internationalgovernance standards, he added.-VNA
“HCM City plans to spend the money on medium- and long-term publicinfrastructure and social projects in 2016 –20,” Pham Phu Quoc, General Directorof the HCM City Financial and Investment State-owned company (HFIC), told theGovernment website baochinhphu.vn.
During the period, the city is expected to need 850 trillion VND (37.5billion USD) for social development, but is prohibited from mobilising fundsfor fear of breaching the permitted public debt limit.
With the current debt level, the city can only mobilise another 70percent of this year’s budget from issuance of bonds and the like.
“The money is small compared with the need,” Quoc said.
“Therefore, the 67 trillion VND package has much significance forthe city’s development.”
The Prime Minister has also permitted the HFIC to represent thecity in businesses where it owns stakes.
But questions have been asked if money raised from equitisationshould not go into the Business Development and Support Fund first and aboutthe legality of appointing the HFIC to manage the money and represent the cityon the boards of companies.
Quoc dismissed these concerns, saying, “It is in line with articleNo. 13 in the 2015 State Budget Law.”
The law says “Local money, which is recouped from economicorganisations, shall remain at the local level.”
This model has been run on a pilot basis since 2010 and isconsidered a success.
“HCM City has sent a report to the Prime Minister about the modeland confirmed that HFIC has successfully completed its task of safeguarding anddeveloping State capital resources,” Quoc said.
Tran Vinh Tuyen, Vice Chairman of the municipal People’sCommittee, said: “Leaders and experts spent a lot of time to establish theHFIC. The corporation operates as a business and the HCM City People’sCommittee directly manages it.”
The strength of the model lies in professionalising the role ofthe representative of State capital in businesses by applying internationalgovernance standards, he added.-VNA
VNA
