Vietnam’s telecoms industry rings the changes

12 Oct 2005

The Vietnamese government has approved a plan by the Ministry of Posts and Telematics (MPT) to restructure the state-run Vietnam Posts and Telecommunications Corporation (VNPT), separating its post and telecoms functions into two autonomous units, and spinning off all communications companies into subsidiaries under a parent umbrella, by the end of next year. The state is particularly keen that VNPT be split into smaller parts as it has expressed increasing concern about how the powerful incumbent’s actions compromise the work of the regulator.

In another important ruling, the government has confirmed that it will allow foreign investors to set up wholly foreign-owned telecoms companies in 2006. Currently, overseas companies are only allowed to enter Vietnam’s telecoms market via business cooperation contracts (BCCs), which allow the operators to invest in a state-run enterprise and receive a share of its profits for between five and 15 years.

Vietnam, VNPT-Vinaphone