Ho Chi Minh City faces difficulties when equitizing public service units
Ho Chi Minh City is facing many difficulties in converting public service units into joint stock companies, so far no cases have been implemented.
The Ho Chi Minh City People's Committee has just sent a report to the Ministry of Finance on the situation and results of converting public service units into joint stock companies in 2025 and the period 2021 - 2025.
After merging with Binh Duong and Ba Ria - Vung Tau, Ho Chi Minh City currently has 48 public service units under the Ho Chi Minh City People's Committee; 528 units under departments, branches and sectors; and 2,026 public service units under the commune-level People's Committees.
Although it has reviewed and included 82 units in the proposed conversion list before the merger, up to now, Ho Chi Minh City has not had any public service units converted into enterprises.
The reason is that some units have unstable revenue sources and decreased revenue, such as the Institute of Occupational Safety and Hygiene Science. Some other units have problems with large tax debts, typically the Sports Service Center.
Many units are too small, have less than 5 employees, no separate headquarters or the remaining asset value is less than 200 million VND, such as the Economic Application Consulting Center or the Institute of Construction Planning.
For Market Management Boards, the difficulties became more complicated. The consumer trend is shifting strongly from traditional markets to shopping and e-commerce centers, causing purchasing power at the market to decrease significantly, many stalls are not filled.
If switching to a joint stock company model, the service price using sales area must cover all costs, leading to price increases, affecting the business psychology of traders, making investors not interested.
In addition, many traditional markets are small in scale, some markets temporarily using the roadside are forced to rearrange; some markets are classified as historical - cultural relics, so they must be maintained and conserved according to regulations. Having a market for part of the property owned by the private sector makes it difficult to determine the value of state capital when equitizing.
Currently, Ho Chi Minh City is focusing on implementing the rearrangement of public service units. It is expected that the Binh Duong Vocational Education - Driving Testing Center will merge with the Ho Chi Minh City College of Transport. The Binh Duong Traffic Construction Management and Repair Department will be merged into the Ho Chi Minh City Traffic Construction Investment Project Management Board.
Some Market Management Boards, Public Works Management Boards of Con Dao District, and Water Supply Stations of Con Dao District are expected to be merged into the Public Service Supply Center in wards and communes.
The Bus Station Management Boards will be merged into Saigon Transport Mechanical Corporation - LLC, while the Motor Vehicle Inspection Centers will also be considered for merger.
From the above reality, the Ho Chi Minh City People's Committee proposed to temporarily submit to the Prime Minister for approval the list of public service units to be converted into joint stock companies.
After completing the arrangement and reorganization of public service units and when the Prime Minister issued a list of sectors and fields of conversion for the next phase, Ho Chi Minh City will continue to review and propose in accordance with regulations.
Read the original here
