Introduction

Vietnam began the first steps of its reform of state-owned enterprises (SOEs) in the early 1980s. This subsequently evolved into a massive and fundamental reform of SOEs, towards a greater degree of market orientation in the late 1980s and early 1990s. At first, the reform of Vietnam's SOEs was primarily in the area of management and planning, thereby providing more autonomy for SOEs within the framework of a centrally planned economy and the gradual reduction of state subsidies and allowances. Until the implementation of the doi moi (economic reform) programme in 1986, whilst there had been some renovation of the state sector, SOEs were still operating within an environment without market competition. At that time the economy simply consisted of the state and collective sectors, with no private sector. Under such conditions, the management of SOEs was a purely administrative exercise. Without the pressure of competition, SOEs found no motive for the revision and improvement of regulations intended to make them more operationally efficient. Instead, SOE managers tended to concentrate all their efforts on fulfilling mandatory targets assigned to them, and dutifully obeying directives or orders stemming from the resolutions and decrees of the ruling party and government.

To implement the economic renovation process, and develop a multisectoral economy, is to develop a wide range of production factors, including: SOEs, family and collective enterprises, individuals’ businesses, private limited companies, shareholding companies, joint ventures with foreign firms, and so on. Economic reform, therefore, is to change from a centrally planned economy into a market-oriented, multi-sectoral economy, operating under a market mechanism. Enterprises with different forms of ownership structure are encouraged to develop and compete in this market environment. In such a context, a demand arises for a better defined and more appropriate legislative framework, in order to ensure the equality of all enterprises before the law, and the concretization of the legal provisions needed to regulate the economy and the various enterprises (including SOEs).