And then there's Petronas, Malaysia's giant oil and gas corporation, which has enjoyed a monopoly since 1974. With profits of $40 billion in 2010 ($10 billion more than ExxonMobil!), Petronas is one of the world's great money machines.
The anti-corruption watchdog Transparency International ranks the Malaysian energy giant at the bottom of its company scorecard both on anti-corruption efforts and organizational disclosure. Petronas probably has good reasons for secrecy; it has only grudgingly launched an anti-corruption initiative that will compel it to share information with the Malaysian Anti-Corruption Commission.
Prime Minister Mohamed Najib has acknowledged the need for broad SOE reforms on the grounds that crony capitalism is discouraging foreign investment. He also pressed for Malaysia's first antitrust law, which went into effect in February 2012. From now on, the SOEs will have to answer to a Competition Commission with wide investigative powers. While the prime minister (who appoints the members of the commission) faces some opposition from within his ruling party, he's positioned to use the TPP talks as an excuse to sustain the effort to rein in state-owned enterprises.
The same cannot be said for Vietnam. To be sure, the Politburo started down the capitalist road as far back as 1986 with the Doi Moi reforms, which were intended to mirror Deng Xiaoping's capitalist-socialist hybrid in China. By 2006, the SOEs' share of GDP had been whittled to "just" 38 percent. But the party and the bureaucracy have since managed to push back, stalling further efforts at privatization or internal SOE reform.
In 2008, a group of Harvard economists who run an advisory program in Vietnam drove the point home with a detailed 56-page analysis of why Vietnam hasn't managed the sort of growth that would put it in the income category of, say, South Korea or Taiwan. The report places much of the blame on the SOEs, which include the country's dominant oil, electricity, railroad, telecommunications, banking, and insurance companies. Not only did the companies lack professional management, the report concluded, but they also failed to focus on improving their ability to compete in international markets. Worse still, the economists said, insiders had used the SOE reforms to build personal fortunes by misappropriating state assets.
While it is a crime in Vietnam to criticize the economic policies of the Communist Party, SOE scandals have occasionally become a matter of public record. Vinashin, the state-owned shipping company that Prime Minister Nguyen Tan Dung once predicted would become the world's fourth-largest shipbuilder, collapsed in 2010 under the weight of $4.6 billion in debts -- a good chunk of which was owed to foreigners. The impulse to use government credit to invest in businesses beyond Vinashin's competence (such as speculating in real estate) had proved irresistible, it seems. (Nine of Vinashin's executives, including its chairman, were recently sentenced to long prison terms.) Post-scandal, Vinashin is now being restructured, but not necessarily reformed. According to Jonathan Pincus, Dean of the Fulbright Economics Teaching Program in Ho Chi Minh City, the government's approach to reform does not involve "tightening corporate governance" or "increasing transparency."