INTRODUCTION
1.Necessity of the thesis
The number of state-owned enterprises (SOEs), though accounting for only less than
1%1, is the force that holds key economic sectors of the country, responsible for ensuring
macro balance of the economy, public benefit, security and defense. Currently, the recent
trend of globalization leads to a strong penetration of enterprise into every part of the world
economy, requiring a level playing field for all economic entities, including SOEs
(Capobianco and Christiansen, 2011). It can be observed that competitive neutrality is a new
trend in competition planning and development in many countries around the world,
especially developing countries (OECD, 2012; Dordi, 2016).
In Vietnam, competitive neutrality also began to be interested in and fully aware of in
the national policy system. In addition to that building and innovating competition of SOEs is
the prerequisite measure to ensure the positive contribution SOEs to overall economic
efficiency and national competitiveness. In reality, SOEs, though enjoying many incentives,
their low operating efficiency leads to the fact the more monopoly they have, the less
competitive their capacity is (Henning & Kou, 2018; Gershman, Roud &Thurner, 2018).
Further, SOEs – the market – competitiveness is an issue that attracts the attention of most
countries, including Vietnam. As Vietnam is a developing country transitioning to an
economic model that moves according to the objective laws of the market, the research,
application and implementation of competitive neutrality in practice require a lot of time and
resources.
For the above reasons and with a wish to contribute to the research on the topic of
competitive neutrality in the economy to find out the possibilities of applying in Vietnam, we
have decided to choose “Competitive neutrality: Challenges and recommendations for
competitive renovation of State-owned enterprises” as the subject of our thesis.
2. Research objectives
2.1. Research objectives
The thesis clarifies the theoretical basis, contributes to adding academic content on
competitive neutrality, competitive naturally policy, the role of competitive naturally in
competitive activities in the market economy, international integration, the role of of SOEs in
the economy as well as the challenges to SOEs under the conditions of applying competitive
neutrality. The thesis gives recommendations for SOEs, in order to renovate competitive
strategies and improve effective competition based on competitive neutrality principles.
2.2. Research missions
- Literature review on competition, competition policy, and competitive neutrality.
1Vietnam Statistical Yearbook 2018
- Clarifying and analyzing the practice of competitive neutrality in some typical
countries.
- Analyzing the practical experiences of some countries around the world about
competitive neutrality, the competitive situation of enterprises in the market, especially SOEs
and lessons drawn related to Vietnam.
- Studying the current situation of the competitive environment in Vietnam, primary
signs of competitive neutrality and the issues posed to the competition of SOEs under the
condition that Vietnam is a member of the WTO and participants in many free trade
agreements of new generation.
3. Research object and scope
3.1. Research object
The research object focuses on competitive neutrality, competitive neutrality policy and
competition of SOEs under the condition of applying competitive neutrality policy.
3.2. Research scope
In terms of content, the thesis focuses on research on competition of SOEs, competitive
neutrality, problems raised in application, as well as the competitive renovation situation of
SOEs under the current conditions of applying competitive neutrality policy in Vietnam.
In terms of space, the thesis focuses on researching practical issues of competitive
neutrality of SOEs in Vietnam and abroad when studying the experiences about competitive
renovation of SOEs in OECD countries and some other developed countries.
In terms of time, the thesis studies the current state of competitive renovation of SOEs
under the conditions of applying competitive neutrality policy in Vietnam from 2004 since
the introduction of the Competition Law until 2035 on the basis of proposing solutions,
recommendations for SOEs.
4. Research methodology
In order to realize the thesis, the research method used is based on qualitative research
method in combination with qualitative research method. The qualitative research method is
conducted through case studies and expert interviews. The qualitative research method is
conducted through questionnaire survey, then regression analysis.
We carry out the research process through 06 steps specifically as follows:
Figure 1: Research process
After collecting data, we proceeded to process and analyze the data, especially for the
survey data, after collecting; we synthesized and processed by Excel and SPSS.
5. Research questions
The research questions include:
- What are the theoretical foundations for competition, competitive neutrality and
competition of SOEs under the conditions of applying competitive neutrality policy? What is
the nature of competitive neutrality? Why should competitive neutrality be applied, and when
it is applied, how it will affect the competition of SOEs?
-What are the challenges posed to SOEs when implementing their competitive strategy
in the market under the conditions of applying competitive neutrality? Specifically, the
current situation of competition and challenges to SOEs in Vietnam under the conditions of
applying competitive neutrality?
-What solutions can be implemented to renovate SOEs’ competition under the
conditions of applying competitive neutrality in Vietnam?
6. Thesis contributions
Through the research results, the thesis has made some new academic and practical
contributions. Firstly, the thesis clarifies the main theoretical issues about competition and
competitive neutrality. Secondly, it systematizes and classifies the contents related to the
renovation of competition of SOEs under the conditions of applying competitive neutrality.
Thirdly, it summarizes many practical lessons on the experience of SOEs in the world under
the conditions of applying competitive neutrality. Fourthly, it focuses on analyzing and
assessing the current situation of renovation of competition of SOEs in Vietnam, from which
to review the achievements as well as shortcomings. Fifthly, it proposes 05 sets of solutions
to enable SOEs successfully implement the competitive renovation process.
7. Thesis structure
Apart from the Introduction and Consolation, the thesis is structured into the following
chapters:
- Chapter 1: Literature review
- Chapter 2: Theoretical issues about competition, competitive neutrality and
competition of SOEs under the conditions of applying competitive neutrality policy
- Chapter 3: The current situation of competitive renovation of SOEs under the
conditions of applying competitive neutrality in Vietnam
- Chapter 4: Perspectives, directions and recommendations for competitive renovation
of SOEs under the conditions of applying competitive neutrality in Vietnam.
CHAPTER 1: LITERATURE REVIEW OF RESEARCHES RELATED TO
THE THESIS SUBJECT
1.1. Literature review of international researches
The thesis ascertains the research situation abroad according to four groups of contents.
With the first content, regarding SOEs, there have been many works to clarify the concept
and function of this type in the economy, such as those of the OECD (2015); Putnins (2014).
About the second content, concerning studies on concepts, principles, and practices to
promulgate and implement policies to the principles of competitive neutrality in the member
countries. At the same time, it should be mentioned here that studies by Capobianco (2011),
Fox and Healey (2013) on the role and influence of antitrust law, the premise for the
application of anti-competition measures in countries, including anti-competitive practices at
the state and local levels.
Regarding the application of competitive neutrality and challenges posed to SOEs,
Stefano (2018) analyzes that whether competitive neutrality principles of SOEs can be
applied by international arbitration courts in dispute settlement between investors or not.
Zwalf (2017) clarifies how to apply competitive neutrality policy in the guidelines on public-
private partnership (PPP) in eight G20 economics. Rennie and Lindsay (2011) give a
comprehensive overview of the framework of competitive neutrality of the Commonwealth
of Australia as well as individual countries.
With the last key content on competitive renovation of SOEs, recent studies, such as
study by Bortolotti et al. (2018), investigates the impact of state ownership on enterprise
renovation, which is measured by the quantity, quality and value of patents. Belloc (2014)
focuses on operating performance, more specifically, technological renovation activities of
SOEs in manufacturing industries, where there is a relatively intense competition between
SOEs and private companies.
1.2. Literature review of researches in/about Vietnam
In Vietnam, the number of researches on competitive neutrality is still very limited,
mainly centered around competition, competitiveness, competition-related issues and SOE
restructuring. Currently, there are not many significant research works dedicated to
competitive neutrality. However, there are a few researches that at some level and in certain
aspects are on or related to competitive neutrality, such as OECD Assessment of Competition
Law and Policy: Vietnam (2018), “Status and solutions to promote restructuring, renovation
and improvement of SOE operating performance” by Dang Quyet Tien (2018), etc.
The most typical is the research works by Tang Van Nghia et al. going deeply into the
issue of competitive neutrality and competitive neutrality implementation in Vietnam.
Specifically, “Competitive Neutrality: Challenges on the Application for Vietnam” by Tang
Van Nghia and Bui Tuan Thanh (2017); “Competitive Neutrality: Challenges on the
Application for Vietnam” by Tang Van Nghia (2016).
1.3. Research gaps
On the basis of the literature review above, we have found that:
Firstly, there are currently quite a lot of foreign documents researching on SOE topics
as well as the issue of competitive neutrality in these enterprises, but most of them are
conducted in developed countries such as the United States, Australia, G20 countries, where
the competitive neutrality policy has been applied quite successfully, creating a level
playground between SOEs and private companies.
Secondly, international organizations such as OECD and UNCTAD also have
numerous reports on the topic of competitive neutrality, both in developed and developing
countries, including Vietnam. These reports, however, are mostly documents, legal
regulations, general frameworks and recommendations serving as guidelines so that countries
at similar level can apply flexibly in their countries, without really focusing on researching
the role and the impact of competitive neutrality on SOEs.
Thirdly, there are not yet many studies focusing on in-depth analyses of competitive
neutrality in an adequate manner, but only on a small scale, such as within a certain economic
sector, or the content of competitive neutrality in agreements, such as CPTPP, FTA…), or in
some developed countries.
Fourthly, scholars have recently focused on SOEs’ competitive renovation, but the
number of studies is still quite modest.
Fifthly, for domestic studies, we found that the number of studies of the issue of
competitive neutrality is not great, not intensive. The focus of most the documents is on SOE
issues such as characteristics, role, operation performance, governance/administration…
In a general way, it can be seen that the studies on competitive neutrality is still limited
in both quantity and depth. There are many contents, on both theoretical and practical bases
that need to be addressed, requiring further research on this issue, particularly at SOEs, in the
