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Social and economic upgrading in the garment supply chain in Vietnam

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  • Chi, Do Quynh

Abstract

The textile and garment industry in Vietnam has achieved fast expansion in terms of production capacity and export value in all three areas of fibre, textile and clothing manufacturing since the early 2000s. However, the growth of the industry has been mainly attributed to the increase of labour and capital rather than economic upgrading. Most of the garment companies in Vietnam are still participating at the lowest value-added sections of global value chains. This report finds little progress in product, functional and sectoral upgrading at the production level. The reasons for the stagnation in economic upgrading originate both in the international buyers' policy to limit technology transfer to protect their business advantage and the lack of an effective industrial policy by the Vietnamese government. Social upgrading has been achieved mostly in the larger, export-oriented firms that are under the scrutiny of international buyers, while the SMEs and household businesses have been plagued with forced overtime, wildcat strikes, and low wages.

Suggested Citation

  • Chi, Do Quynh, 2020. "Social and economic upgrading in the garment supply chain in Vietnam," IPE Working Papers 137/2020, Berlin School of Economics and Law, Institute for International Political Economy (IPE).
    • Handle: RePEc:zbw:ipewps:1372020
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    References listed on IDEAS

    as
    1. Doug Miller, 2013. "Towards sustainable labour costing in UK fashion retail," Global Development Institute Working Paper Series ctg-2013-14, GDI, The University of Manchester.
    2. John Humphrey & Hubert Schmitz, 2002. "How does insertion in global value chains affect upgrading in industrial clusters?," Regional Studies, Taylor & Francis Journals, vol. 36(9), pages 1017-1027.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    economic upgrading; social upgrading; global value chains; industrial policy; labour rights; garment industry;
    All these keywords.

    JEL classification:

    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure

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