Govt Rejects Proposal To Buy Its Stake In BCEL
Source: Vientiane Times
The government has declined a request by the Phousy Group to purchase a major stake in a leading Lao bank, the Banque pour le Commerce Exterieur Lao Public (BCEL).
The Group recently submitted a proposal to buy a 51 percent stake in the bank, which is currently held by the government, represented by the Ministry of Finance.
The Prime Minister’s Office on November 17 issued a notice rejecting the request to sell its stake in the bank.
The rejection came after the Ministry of Finance and the Bank of the Lao PDR studied the proposal.
The government said the bank was listed on the Lao stock market – the Lao Securities eXchange and operates transparently with financial liquidity.
“Therefore, [the government] has decided not to sell its stake in the bank to any party,” the notice said.
The Group’s proposal to purchase the state’s stake in the bank came after the government introduced a policy to engage private investors or create joint ventures for the management of state enterprises.
The policy is a milestone in the government’s plan to reform state enterprises after learning that most have operated inefficiently and made losses for years or decades, accumulating huge debts.
Through the reform programme, the government will decide which enterprises should be 100 percent government-owned, which ones could become a joint public-private venture, and which ones should be sold off.
An indicators-based assessment carried out in 41 state enterprises concluded that about 10 were viable and could continue, but the rest needed to undergo reform, the government told the National Assembly in August.