Vietnam bonds for foreigner

Vietnam bonds for foreigner

HANOI (Reuter): Vietnam said yesterday it would let foreign residents and companies buy bonds and shares to be issued by state-owned companies in what an economist said was a new form of privatization.

Foreigners, foreign companies working in Vietnam and overseas Vietnamese will be able to own the instruments, as well as Vietnamese enterprises, according to a government decree published in newspapers.

A government economist said the planned issue of shares in state firms would amount to issuing new capital that would be privately held, diluting ownership by the state.

"It's another form of equitization," he said, using one of the terms the communist authorities employ as a euphemism for privatization.

Efforts to privatize state companies as part of market reforms introduced in 1986 have moved more slowly than expected and only a handful have completed the process of transferring ownership to shareholders, mostly employees.

Government bonds -- and later company shares -- are expected to be tradable on Vietnam's first stock exchange, probably to be launched in Ho Chi Minh City next year.