Analyze descriptive statisticsCollect and process data
CHAPTER 3: RESEARCH RESULTS AND DISCUSSIONSDISCUSSIONS
4.2 Recommendations for Vietnam construction firms and the Governmentthe Government
4.2.1 Recommendations for Vietnam construction firms 4.2.1.1 Restructuring the ownership structure
To increase financial performance, companies need to carry out ownership restructuring, especially state-owned companies, in the direction of reducing the state ownership rate and increasing the foreign ownership ratio. Corporate restructuring is very important for businesses at this time, especially when the Covid-19 pandemic causes businesses to change their operation methods to quickly adapt to the new business situation and to the high integration trend of the country.
In a market economy that is always changing and developing constantly, the fact that businesses must regularly review and consolidate resources to adapt is considered an inseparable task in the production and business process, especially when businesses
show signs of underemployment, outdated technology and management systems, reduced profits... In the context of Covid-19 pandemic, business restructuring has become more urgent and necessary than ever.
Restructuring ownership structure is a matter of interest to many managers and economic experts. It is a fairly common concept today and is approached in many ways depending on the circumstances, conditions, and will of the company, managers as well as the employees of each enterprise. Although there are many concepts and analysis, it still exudes the inclusion of restructuring, reforming the resources of the enterprise to meet the requirements of customers, the market and remove limitations, as well as signs that threaten to inhibit the existence, stability and development of enterprises.
Furthermore, Vietnam construction firm should also restructure governance, setting up security and safety systems, risk management and change management: Designing and adjusting to have an advanced management and operating model with full regulations, regulations to comply with the law, ensure security, safety, and environmental friendliness. On the other hand, the reform process must have changes, especially strategic changes, so it is necessary to create an appropriate change management plan to be proactive and consistent in the process under all circumstances, especially during and after the pandemic.
Besides, financial restructuring: With the principle of publicity and transparency, mobilizing and maximizing the money and assets that businesses have, seek support from policies for reform, especially during the pandemic, negotiate with business partners,
etc., to have capital to maintain daily operations. And the issues that need attention, based on professional analysis, legal compliance such as: Charter capital plan and ownership structure (increasing or decreasing capital, divesting or investing more capital outside the enterprise); Debt structure and other values to maintain cash flow; Reasonable financial plan; Standardize revenue recognition policy, cost analysis, cash flow, gross profit margin analysis; Check and supervise the work of accounting and financial statements.
And last but not least, making an implementation plan: The order and plan to implement the structure and reform are tasks throughout the production and business process and are integrated with change management, it is determined the schedule and assign them to each individual and group and request to perform methodically and decisively, always complying with current regulations with the determination and determination of the manager as well as the team of the enterprise.
4.2.1.2 Attracting the foreign investment
In order to successfully attract foreign investors to the enterprise, first of all, Vietnam construction enterprise must prove to the investor the advantages and competitiveness of the product, the profit and revenue increase sharply over the years. me. These factors will help investors believe in the benefits of their capital.
Unique, dominant and competitive products in the market:
Most investors want to invest into companies with competitive advantages in the market, products with their own unique features.
Therefore, to attract investors, Vietnam construction firms need to
demonstrate the advantages of their products by comparing them with competitors' products and substitutes.
The company's products have high profitability: Profit margin is one of the financial indicators that a business' products and services have a place in the market. According to research by Stanford University professors, companies all start to be profitable in the second year of establishment. Therefore, the wise investor who understands this key factor will not pay attention to the companies that declare a profit after three to five years.
Revenue has increased sharply over the years: Strong revenue growth over the years will make investors believe in the company's business situation, which means that the capital they spend will be effective. As a general rule, if a company can't show sales numbers in year three and double that in year five, no investor is interested in the business venture.
Besides, Vietnam construction firms need a professional operating apparatus. The level of professionalism in the management, production and business activities of an enterprise is always the top criterion that investors consider about an enterprise.
Does that professionalism show the management of the business leadership team, the transparent financial management, the accurate reporting of information, the clear and sufficient prediction?
In addition to that, professional management team: Many foreign investors consider the corporate governance team as a basic criterion for making investment decisions. The company's CEO must be a person who is able to work in a cooperative spirit, deeply understand the market and customers to know market
fluctuations and run the business in the right direction. investors have little to do with the field of activity in which they invest. To do this, businesses need to apply international standards on corporate governance and governance. The business leaders themselves also have to actively study to improve their management capacity.
4.2.2 Recommendations for the Government 4.2.2.1 Removing difficulties for the real estate market
The Ministry of Construction shall assume the prime responsibility for, and coordinate with ministries, agencies and localities in:
- Continue to perfect the system of legal documents on urban management, housing development, and real estate business in the direction of strengthening state management and effective control of planning and planning. land use, construction planning, housing development plan, real estate prices to ensure the balance of supply and demand, in line with the socio-economic development plans of each locality and the needs of the market.
There is a mechanism to encourage businesses and individuals to participate in social housing development and research and issue preferential credit policies for low-income people, cadres, civil servants, public employees, and workers and employees can buy, rent and lease-purchase houses for living in accordance with legitimate income.
- Review all housing development projects to categorize projects to be continued, projects to be paused, projects to adjust housing structure and type, convert to development social housing to suit the needs of the market and social resources. Implement the
National Housing Development Strategy to 2025 with a vision to 2030 approved by the Prime Minister.
- Guide and support real estate businesses to proactively adjust business activities and restructure businesses accordingly, such as: reducing selling prices, adjusting the structure of goods to suit their ability to pay; apply flexible sales methods, encourage the shift to lease, hire-purchase; transition to social housing; using loans for the right purposes and mobilizing capital from customers, performing openly, transparently, on schedule, creating trust with customers.
- Shorten the time for planning appraisal and approval, especially quickly resolving procedures that allow the adjustment of the project structure in stock, construction in progress to suit market needs and procedures. conversion from commercial housing project to social housing.
- Allowing the conversion of commercial housing projects into social housing for lease or lease-purchase for policy beneficiaries:
low-income people, cadres, civil servants, public employees, armed forces, workers, students and service workers such as hospitals, schools, hotels, and commercial services are in demand but must be suitable for planning and infrastructure conditions. In case these subjects are eligible for land use levy exemption or reduction as prescribed by law, they shall be deducted from the amounts payable to the state budget or from the state budget for withdrawal of paid land use levy.
4.2.2.2 Promoting foreign ownership of listed companies
- Foreign investors can own up to 60% of the total voting shares of a listed company.
- Regulations that foreign investors will be allowed to hold a maximum of 49% of the total voting shares in the public company.
- For non-voting shares, foreign investors are not limited to holding non-voting shares, as long as foreign investors have demand to buy and do not need to vote.
With fund certificates, foreign investors can own 100%.
Previously, for closed-end funds, the maximum foreign ownership ratio was 49%. In this draft, it applies not only to closed-end fund certificates but also to open-ended fund certificates, ETFs, etc. In the case of funds with foreign ownership above 49%, it is understood. are foreign investors and are subject to the law.
-Foreign securities trading organizations are allowed to buy and hold securities companies in Vietnam up to 100% of charter capital, instead of the current regulations of maximum 49% and 60%. Thus, if the draft is approved, it is understood that foreign securities trading organizations are allowed to buy and hold securities companies in Vietnam up to 100% of charter capital, that is, they are allowed to own more than 49 shares % and less than 100% of charter capital.
4.2.2.3 Improving the legal framework for construction sector
First of all, the Government should continue to focus on perfecting mechanisms and policies in all areas of the industry, in which the focus is on completing them to submit to the National Assembly and the Government for approval of the Construction Law (amended) and guiding Decrees. implementation, the Law on Housing (amended) and the Law on Real Estate Business (amended); study mechanisms and policies to attract and mobilize domestic and foreign resources for investment in urban
infrastructure development (water supply, drainage, solid waste treatment); reviewing, amending and supplementing economic- technical norms and norms to suit the actual situation...
Second, it is necessary innovate and improve the quality of planning, review, adjust and supplement regional and general plans nationwide, speeding up the speed of covering zoning planning and detailed planning, rural construction planning; urge, guide and inspect the implementation of the formulation and management of the implementation of urban design, regulations on management of urban planning and architecture.
And third, the Government needs to implement Decree 15/2013/ND-CP, strengthen the management, inspection and supervision in construction investment, especially for projects using state capital and construction companies. large-scale and complex processes, which greatly affect the safety of the community, improve the efficiency of the use of investment capital, and ensure the quality of construction works; coordinate with relevant ministries, branches and localities in implementing a program of safety assessment of hydroelectric and irrigation dams nationwide, verifying the quality of narrow tower structures over 100m high;
strengthen construction management under permits.
Fourth, it is important to actively implement Decree No.
11/2013/ND-CP, strengthen management and strictly control urban development projects according to master plans and plans; direct localities to urgently build and approve urban development zones, establish urban development area management boards to help provincial-level People's Committees control urban development according to master plans and plans; implementing programs and
projects on urban development and technical infrastructure according to the plan.
Fifth, the Government should promote the implementation of the National Housing Development Strategy; complete the approval of local housing development programs; implementing Decree No.
188/2013/ND-CP on management and development of social housing; actively implement programs to develop social housing, housing for low-income people in urban areas, housing support programs for people with meritorious services, poor households in rural areas and regular areas affected by storms and floods.
And last but not least, it is important for the Government to strengthen the management of construction materials according to planning, especially cement and key construction materials, ensure the balance between supply and demand in the domestic market, promote exports, and settle inventories; actively develop unburnt building materials; strengthen control over the exploitation, processing and export of minerals as building materials.