INSIGHT

Privatisation in Vietnam

By Linh Bui
Asia

In brief

The Vietnamese Government has an ambitious plan to equitise and divest state capital in more than 500 enterprises by 2020, in order to improve the management and operation of state-owned enterprises and raise capital to address the state's budget deficit. This process offers a variety of ways for private investors – particularly foreign investors – to tap into the Vietnamese market by investing in companies with leading market positions and nationwide networks. However, the lengthy and complex process for equitisation and state divestment has been a major impediment to foreign investment in this sector. In an effort to improve the legal framework, and ensure efficiency and transparency in this process, the Government recently introduced some major changes to the relevant regulations. We look at the upcoming investment opportunities, Vietnam's legal framework for equitisation and state capital divestment, and the key legal issues that foreign investors need to consider.

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