The Vietnam Shipbuilding Group is among several state-owned biggies to be inspected by the government next year

The National Assembly, Vietnam’s lawmaking body, on Friday adopted a resolution to increase the efficiency of state-owned corporations, calling for the elimination of poorly-performing firms.

However, many others failed to operate effectively despite government investments and preferential treatment, the assembly said in the resolution.

In a report released early this month, the NA Standing Committee said 45 percent of 91 state-owned groups in Vietnam posted low returns on equity of less than 10 percent while 25 percent had a ratio of under 5 percent. Some even posted negative returns.

According to the report, 23 of the groups posted total cumulative losses of VND2.79 trillion (US$156.5 million) at the end of last year.

As a result, lawmakers said Friday that the government needs to take strong measures to dissolve inefficient corporations that incur losses for several years and don’t have the wherewithal to improve their business.

The assembly also said state-owned corporations can have operate different business lines but must focus on their main business.

Legislators demanded that the government set up requirements that corporations have to meet before they are allowed to expand beyond their main business areas.

According to the report by the Standing Committee, as of the end of last year 47 state-owned groups invested a total VND21.16 trillion into non-core areas such as banking, insurance, real estate and stock. Most of the expansions, however, were not profitable.

At the closing meeting on Friday, National Assembly Chairman Nguyen Phu Trong said results achieved at the sixth session of the 12th NA are expected to help boost Vietnam’s social and economic development.

During the session, the assembly passed seven bills on the elderly, medical treatment, telecommunications, radio frequencies, militia, education and natural resource taxes. They discussed 11 other bills which will be considered further next year.

The deputies also approved plans to build two nuclear power plants in the south central Ninh Thuan Province and a 1.8 billion hydropower plant in the northern mountainous province of Lai Chau.

Reported by Xuan Toan