Vietnam will tighten its grip on electricity and petrol prices set by state monopolies and accelerate the privatization of state-owned companies, its new finance minister was quoted on Thursday as saying.
Vuong Dinh Hue, approved by the National Assembly on Wednesday as finance minister, also said it was important to control the country’s debt to avoid the problems facing certain European countries.
“Regulating prices, especially those of electricity and petrol, needs to be based on the transparency of costs and revenue,” Hue was quoted as saying by news website VNExpress.net.
Vietnam instituted double-digit increases in petrol and electricity prices earlier this year. Oil prices have eased somewhat since earlier in the year and Petrolimex, Vietnam’s biggest importer and distributor of oil products, has come under pressure for not reducing pump prices.
“One of my priorities will be to work with the price control department under the Finance Ministry to make clear what Petrolimex’s story is, as well as the costs, profits and losses of the electricity sector,” Hue said.
Hue, who was previously chief state auditor, said he would put his auditing experience to good use and “for sure the costs and profits (in the energy sector) will be more transparent in the coming period”.
The Finance Ministry will closely monitor public and foreign debt and press reforms at state-owned companies, too, he said.
The country’s sovereign debt ratings were downgraded last year by all three major ratings agencies over concerns about the economy.
A joint IMF-World Bank debt sustainability study in July last year concluded that Vietnam was at low risk of debt distress, although debt indicators were deteriorating in the wake of the global economic crisis.
“Tightening control over the national debt, public debt and foreign debt is an important issue to ensure safe levels and not to fall into the situation faced by some European countries now,” Hue said.
“To effectively reform the models of state-owned companies and economic groups and speed up equitization (privatization) will be the duty of Ministry of Finance in the coming period.”