The Business Strategy of Vietnamese Enterprises Listed on the Stock Exchange: Change in the Business Strategy of REE after Listing

Abstract

Changes in the business environment of Vietnamese stated-owned enterprises (SOEs) after 1999, and especially after 2000, arise from the equitization of SOEs and the establishment of a securities market. In the late 1990s, it was said that “Equitization brings in new capital sources for SOEs. However, the establishment and development of the securities market is a necessary requirement for equitization” (Ishikawa 1999: 315). The equitization of SOEs began in 1993, and by the end of 2007, 3,752 SOEs had been converted into joint stock companies. The number of listed or registered enterprises on the Vietnamese securities market were 156 enterprises listed on the Ho Chi Minh Stock Exchange¹ and 145 enterprises registrated at the Ha Noi Securities Trade Center² (as of the end of July 2008). The stock of about 3,400 non-listed and registered companies on the two markets had been circulating in over-the-counter (OTC) trading.³ However, in fact only the stocks of about 200 enterprises⁴ were being transacted on a daily basis. According to a report published by the State Securities Commission of Vietnam in January 2009, about 600 SOEs⁵ had met the listing requirements by the end of 2007.⁶