The Vietnamese government is to privatise its two largest breweries as part of an overhaul of the state's alcohol company the Vietnam International Alcohol Beer and Beverage Corp (Vinabeco).

The two breweries concerned, Saigon Beer and Hanoi Brewery, hold about 30% of the country's beer market and contribute some 90% of Vinabeco's revenues.

Saigon beer produces some 160m litres of beer for the central and southern part of the country, while Hanoi makes around 50m litres for the rest of the country.

Vinabeco chairman Nguyen Van Viet said: "In the development strategy for Vietnam's industry to 2005, the industry minister has decided to equitise the two in line with the reorganisation process.

"The equitisation will start in early 2003 as the two want to modernise equipment and expand production. However Vinabeco would prefer an early start, so that the process could be completed by 2005."

Viet added that the state had no need to retain sole ownership as beer was not a government monopoly industry.