Preferential treatment in transition economy the case of state-owned enterprises in the textile and garment industry in Vietnam

Abstract

The article examines the role and contribution of preferential treatment of state enterprises to growth in the textile and garment industry. State enterprises are still the largest single sector in the textile and garment industry in Vietnam, but are losing market shares to private Vietnamese enterprises and foreign-owned enterprises despite the benefits that they enjoy. However, in the present context of economic transition and keen competition in the global market, well-managed state enterprises are attractive to foreign buyers of their products and have a role to play in market access abroad. This contrasts with the neoliberal notion that privatization is essential to competitiveness in the global market.