Over the more than four decades of the “Doi Moi” (Economic Renewal) process, Vietnam’s shift from a centrally-planned, subsidized economy to a market-based system has transformed State-owned enterprises (SOEs). While their numbers have declined, their scale and efficiency have continued to improve. Beyond the pursuit of profit, SOEs have retained an irreplaceable role in carrying out critical economic and social missions and in serving as a firm backbone for the broader economy.
According to data from the National Statistics Office at the Ministry of Finance, in the 1975-1985 period, prior to Doi Moi, Vietnam had more than 10,000 State-owned economic entities operating in most economic sectors. As Vietnam entered the Doi Moi era and began reducing subsidies and restructuring its State apparatus, the number of SOEs fell sharply, from 3,020 in 1989 to 2,170 in 1994. Yet through proactive innovation and comprehensive restructuring, the State-owned sector quickly adapted and regained strong growth momentum.
At constant 2010 prices, the value-added generated by the State-owned sector stood at just VND174.33 trillion ($6.7 billion) in 1986. By 2025, it was estimated to have reached VND1,353.15 trillion ($52.04 billion), or 8.72-times the 1986 level and representing average annual growth of 5.71 per cent during the 1987-2025 period.
Laying the foundations
Though the State-owned sector’s share of GDP declined from 36.58 per cent in 1986 to an estimated 20.89 per cent in 2025, reflecting the rapid expansion of the private and foreign-invested sectors, its absolute scale has continued to grow. The sector has also become increasingly concentrated in backbone industries that remain critical to Vietnam’s economy.
SOEs are no longer spread across small-scale services or wholesale and retail trade as they once were. Rather, they are increasingly focused on opening up new areas of development, shouldering infrastructure investment, and creating the conditions for other economic sectors to grow. The resilience of SOEs in strategic industries has been a key factor in helping Vietnam’s economy maintain stability amid geopolitical shifts and global economic crises.
In energy security, leading State-owned groups such as Vietnam Electricity (EVN), the Vietnam Oil and Gas Group (PetroVietnam), and the Vietnam National Coal and Mineral Industries Holding Corporation Limited (TKV) ensure the stable and continuous supply of energy and fuel for the production and business activities of millions of enterprises as well as for household consumption.
Regarding connectivity infrastructure and telecommunications, the Vietnam Posts and Telecommunications Group (VNPT) and the Viettel Group have played leading roles in developing nationwide telecommunications networks. They have also served as pioneers in the country’s digital transformation and e-government development. The information and communications sector has steadily increased its contribution to GDP from 1.22 per cent to 3.26-4.39 per cent in recent years.
In banking and finance, State-owned commercial banks (SOCBs) such as Agribank, Vietcombank, VietinBank, and BIDV play a leading role in supplying capital to the economy. They have helped raise the contribution of financial, banking, and insurance activities from 1.22 per cent of GDP in 1986 to an estimated 4.8 per cent in 2025. SOCBs not only effectively implement preferential credit policies but also serve as instruments for interest rate management and maintaining stability across the national financial and monetary system.
Importantly, SOEs do more than pursue profits: they also serve as effective instruments of macro-economic regulation. During periods of volatility in global energy and raw material prices, SOEs have taken the lead in stabilizing prices of essential goods and limiting the adverse effects of inflation.
At the same time, they have pioneered the provision of public services, extending electricity and telecommunications networks, and building roads in remote, mountainous, border, and island areas - locations where costs are high and profitability is limited, making them difficult for private businesses to reach. These efforts also contribute to national security and poverty reduction.
By maintaining a dominant position in these key sectors, SOEs provide essential technical infrastructure and services, helping reduce input costs for other economic sectors and creating favorable conditions for private and foreign-invested businesses to grow.
Strategic priorities
In terms of resource efficiency, though SOEs account for only a small share of the total number of operating businesses, they control substantial assets and capital and make significant contributions to the national budget.
Every year, State-owned groups and corporations contribute hundreds of trillions of VND to the State budget through taxes, fees, and after-tax profits. These revenues provide strategic financial resources for the government to invest in transport infrastructure and expand public services, including education and training, which accounted for about 3.88 per cent of GDP in 2025, and healthcare and social assistance, which accounted for some 2.95 per cent. The SOE sector also provides stable employment and implements comprehensive welfare and occupational safety policies for millions of employees.
In the era of Industry 4.0, SOEs are also transforming into drivers of technology and innovation. Major groups such as Viettel, VNPT, and PetroVietnam have stepped up investment in R&D, taken greater control of advanced technologies, produced telecommunications equipment and management software, developed renewable energy and green solutions, and expanded their investments into international markets.
However, viewed objectively, the State-owned sector continues to face significant barriers and challenges. The equitization and restructuring of SOEs remain slow, reaching only about 16 per cent of the target during 2021-2025. Divestment from non-core investments has also progressed slowly at some enterprises, while the use of capital and land resources in some areas has yet to match their potential. In several fields, the sector’s role in opening up new areas of development, providing leadership, and creating spillover effects for other economic sectors has also fallen short of expectations.
To address these bottlenecks and create new growth momentum, Politburo Resolution No. 79-NQ/TW, issued on January 6, 2026, on developing the State-owned economic sector, sets out core objectives and a clear development roadmap.
First, reforming governance models and improving operational efficiency. By 2030, all State-owned groups and corporations are expected to complete the adoption of modern governance models based on international standards, including Organisation for Economic Co-operation and Development (OECD) standards, while fundamentally resolving weak and persistently loss-making projects.
Second, concentrating resources on strategic industries. Restructuring is to focus State capital rather than spread it thinly, directing resources toward strategic infrastructure, new energy, high technology, semiconductors, digital transformation, and foundational industries where the private sector does not yet have sufficient capacity to invest.
Third, strengthening the sector’s role in opening up new areas and providing leadership. The goal is to develop large-scale State-owned economic groups with strong financial capacity and international competitiveness, serving as leaders that connect, support, and encourage domestic private enterprises to participate more deeply in global value chains.
Fourth, improving the institutional framework for managing State capital. Management processes will be restructured to clearly separate the State’s ownership - representation function from government management and corporate governance, while granting enterprises maximum autonomy alongside open and transparent inspection and oversight mechanisms.
Google translate