Internal Business Organisation in the Private Garment Industry in Vietnam: The Roles of Ethnicity, Origin and Location

Abstract

This paper pinpoints important differences within the private sector in Vietnam. It shows that the country's private sector is much more heterogeneous than is often suggested, and attempts to reveal some of the causal mechanisms that cause this diversification. Theoretically, the paper draws on business system theory, particularly on that aspect of it that deals with internal business organisation, in order to examine the nature of and trends in relation to firm-level management and control. On this background, the paper uncovers a Vietnamese-owned segment in Hanoi, two different Vietnamese-owned segments in Ho Chi Minh City distinguished by the origins of their owners, and a Vietnamese Chinese-owned segment in Ho Chi Minh City.

Business-State Relations in the Differentiated Private Sector in Vietnam: Access to Capital and Land

“…Harvie and Lee, 2002;Steel and Webster, 1992), nor does it depend entirely on ownership form, as is commonly suggested by scholars of Vietnam (see e.g. Van Arkadie and Mallon, 2003;Diehl, 1998;Thomsen, 2007). More significantly, it is determined by the owners' historicaland thus present -relations with the state, and is therefore mediated primarily by Vietnam's political history.…”

“…Even in cases in which the loans were obtained from "real" family members like, for instance, a biological brother, interest rates were applied. It seemed that, just as they preferred to employ members of the family in their companies but had no informal mechanisms to maintain authority over them (see Thomsen, 2009), Vietnamese in Hanoi also lacked even unwritten and trustbased rules on how to borrow from family or close friends. Popularly speaking, they lacked informal "networking rules" or mechanisms even within the family, and hence they had to apply more formalised ones for this type of relationship, as well as for relations with "outsiders".…”

“…The country's business climate depends not only on the regulation and often non-transparent registration of firms in particular state or private ownership forms, but also on the historical and thus present-day relationships of private business owners to the state. Hence, not all private enterprises work under equally adverse conditions as is sometimes being suggested in the literature on Vietnam's emerging political economy; rather differentiations within the private sector exist that have been subject to virtually no research 1 (Thomsen, 2007;2009). The paper shows how these differentiations derive mainly from Vietnam's political history and profoundly influence the relations of owners of private enterprises with the state today.…”

Firm entry modes and Chinese business networks: Malaysian investments in Vietnam

“…Existing research has presented the broad narrative of the Vietnamese Chinese facing persecution after Vietnam's reunification in 1975. 2 The paper also argues that the Vietnamese Chinese people have regained much of their economic influence following the country's doi moi reform in 1986 (see also Thomsen, 2009;Chan, 2013). In its effort to reform the economy and to attract much needed FDI, the Vietnamese state realized that its ethnic Chinese populace was in a privileged position to bolster its economy because of their ties to the overseas ethnic Chinese business community, especially those from Asia's tiger economies (Duong, 1994).…”

“…Therefore, despite the much celebrated revival of their economic vitality, the Vietnamese Chinese are not in a strong position to compete in relatively more capital-intensive and closely regulated sectors such as high-technology manufacturing, construction, utilities and finance. In these sectors, their opportunities are more limited vis-à-vis those who enjoy a good relationship with the state, especially the SOEs and parties friendly to them (see also Thomsen, 2009). The information above suggests that the Vietnamese Chinese firms would link up with the Malaysian Chinese firms, but the pattern of cooperation is likely to differ across economic sectors-more intraethnic cooperation in labour-intensive economic sectors and less intraethnic cooperation in more capital-intensive and closely regulated sectors.…”