Discourse on SOEs in the Constitution-Making Process

Reforming SOE governance became a major focus in Vietnam's 2013 constitution­making process, as part of a larger discourse on the country's economic and political future. With the green light from the VCP to ‘immediate study of revi­sion and supplementation of the 1992 Constitution in conformity with the

new situation', the National Assembly established a Drafting Committee for Amendment to the 1992 Constitution (hereinafter ‘Constitutional Amendment Committee'), comprised of mostly high-ranking Party officials.^[1015] The Committee itself was divided into six sub-committees, each specialising in different constitu­tional issues: (1) the political regime and state apparatus; (2) national defence and international relations; (3) the society and economy; (4) constitutional rights and duties; (5) the judicial bodies; and (6) review of constitutional implementation.^[1016] Given its importance, economic and social reforms, which encompassed SOEs, were delegated to its own sub-committee.

During the constitution-making process, debates on SOE reforms evolved around a number of key constitutional provisions, most consequentially the proposed Article 51, which stated that ‘[t]he Vietnamese economy is a socialist- oriented market economy with multi-forms of ownership and multi-sectors of economic structure; the state economic sector plays the leading role’.^[1017] The next subsection stated, ‘Actors of different economic sectors are equal, cooperate, and compete in accordance with the law'.^[1018] A previous proposal that left out the key phrase ‘the state economic sector plays the leading role' had already been rejected by the National Assembly.^[1019] The proposed Article 51 arguably continued along the same reform arc as previous constitutions. The 1992 Constitution had confirmed SOEs' ‘leading role' and the economy's ‘socialist orientation' while also declaring a ‘multi-sectoral economy' comprised of the state-owned and collective economic sector, the private sector, and foreign investments, among others^[1020] - a marked change from the 1980 Constitution's commitments for Soviet-styled planned economy.^[1021] The 2001 constitutional amendment round replaced the phrase ‘multi-sectoral economy' and embraced for the first time the concept of a ‘socialist- oriented market economy'^[1022] - both of which ultimately found their way into the final proposed 2013 draft.

Debates on the draft Article 51, in turn, centred on two weighty, related issues: the relevance of SOEs' preferential treatment, and the roles of the state in market interventions. On the first, vibrant debates centred on how to define the key actors within the Vietnamese economy. Nguyen Dang Doanh, a leading economist who was part of a group of 72 scholars that proposed an alternative constitutional draft to the National Assembly, was critical of the wording of the official proposal, noting that ‘This new constitution may cost us. It cannot promote market growth when the least efficient economic sector is deemed leading the economy’.^[1023] Other commentators supported the general wording of ‘multi-forms of ownership and multi-sectors of economic structure', arguing that the economy should not be pigeon-holed into specific sectors.^[1024] Some, however, argued that a more specific articulation of the state’s roles in facilitating investment would better boost foreign investors’ confidence and reassure them of Vietnam’s commitment on market reforms.^[1025] The Vietnam Chamber for Commerce and Industry, an influential quasi-governmental trade association, expressed concerns on the lack of any mention of the business sector, arguing that the majority of Vietnamese enterprises are small medium enterprises.^[1026] The phrase ‘state economic sector’ also sparked lively debates. Some argued for a clearer distinction between ‘state economic sector’ (kinh te nha nuoc) and ‘state-owned enterprises’ (doanh nghiep nha nuoc), showing concerns that the two concepts may be conflated.^[1027] Others argued that the articulation of the public sector’s ‘leading role’ could not be reconciled with the following statement asserting the equality among different economic sectors.^[1028] Phan Trung Ly, Chair of the Constitutional Editing Board and Chair of the National Assembly Law Committee, ultimately rejected this argu­ment, noting that ‘state economic sector’ is a broader concept than state-owned enterprises, meant to express the roles of the Party-State in market directions, and thus does not conflict with the subsequent statement on the equality of various economic sectors.^[1029]

Relatedly, and an overarching theme over all constitutional discourse, single party leadership and its tenuous relations with all aspects of legal and govern­ance reforms, state-market relations included, have long been an outstanding issue for Vietnamese leaders.

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