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Govt to list more state enterprises on stock market
The National Committee for State Enterprise Improvement will push for improvements to some state enterprises this year, so they are eligible to become public companies listed on the Lao Securities Exchange (LSX).
The committee made the announcement on Thursday at its annual conference in Vientiane.
The changes are part of government efforts to help state enterprises to mobilise investment capital so they can expand their business and create more jobs.
However, the committee did not say which state enterprises it will help with management restructuring or when they would start to sell shares and list on the stock market.
Among the enterprises that have listing potential are Lao Airlines, Vientiane Water Supply Enterprise, and Lao Pharmacy Factory No.3.
There are about 200 state owned enterprises and 23 state-private joint ventures in Laos. Two state companies, BCEL and EDL Generation, have sold 20 and 25 percent of their shares respectively to local and foreign investors and are now listed on the stock market.
The government not only expects to earn revenue from any forthcoming share issues but wants the companies to be seen to be operating transparently, creating a favourable environment for sustained growth and ensuring effective implementation of its policy.
Chaired by Minister to the Prime Minister's Office Xaisengly Tenbiacheu, the annual conference also agreed to push the government to hand over the assets of state-owned companies for use as bank loan guarantees.
At present, state owned enterprises find it difficult to obtain bank loans as they cannot use their assets as a guarantee against a loan.
The committee will also help state enterprises to develop their business strategies, accounting systems and marketing plans to prepare them for the stiff competition they will face when the government implements its Asean Free Trade Area obligations in 2015.
Training courses will be run to improve the skills of company officials and build managerial capacity.
One of the major challenges the committee will address is creating better understanding among the public and government officials of the importance of healthy businesses and the contribution they can make to development.
The government wants to stop subsidising state enterprises and wants to see them become profitable independently, so they can continue to grow into the future.
According to the committee's annual report, state enterprises have played an important role in the development of the Lao economy over the past few years. In 2009, the revenue earned by state enterprises reached 9,702 billion kip or about 17 percent of GDP.
In 2009, state enterprises paid 2,191 billion kip to the government in taxes and dividends, comprising 27 percent of national income.
vientiane times
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