John Thoburn

Challenges to Vietnamese firms in the world garment and textile value chain, and the implications for alleviating poverty

The global garment and textile industries face changing international trade regimes, concerns with labour standards, new competitors and forms of competition. These challenges have a differentiated impact on developing-country producers and workers. One potential ‘winner’ is Vietnam. This paper uses a global value-chain framework to analyse the Vietnamese experience. It maps Vietnam’s changing position in the global industry, and probes ties between Vietnamese firms and global buyers. It explores links within the Vietnamese garment and textiles sectors, and considers the impact of global challenges on Vietnamese firms and workers. This helps distinguish who are the potential ‘winners’ and ‘losers’.

Industrial policy and the development of the automotive industry in Thailand

It has been argued that restrictions on industrial policy implemented under World Trade Organization rules in the 2000s have greatly reduced the ‘policy space’ in which developing countries can promote industrialisation. This paper examines the case of Thailands policies in developing one of the most successful automotive industries in the Southeast Asian region. We show that Thailands use of local content requirements, later abolished under WTO rules, helped promote local suppliers and did not deter foreign investors. Substantial tariff protection of vehicles and components production did not deter exports, and has continued to the present, even under liberalisation policies. Supplementing tariff protection by various fiscal means to promote product champions in the automotive industry, Thailand has succeeded in retaining substantial policy freedom.

Globalization and poverty in Vietnam: Introduction and overview

The papers in this special issue present results from three research projects on Vietnam looking, respectively, at poverty dynamics; globalization, production and poverty; and at foreign direct investment. Vietnam has seen a striking reduction in poverty since its opening to the outside world in the early 1990s under its doi moi economic reform programme, and evidence for this poverty reduction is not sensitive to where the poverty line is drawn. Inequality, however, has risen. An important part of Vietnam’s reform programme has been the rapid development of labour-intensive manufactured exports such as garments and footwear, partly driven by foreign investment, while the domestic market has remained quite protected. Employment growth has been disappointing, though, since Vietnamese industry has been shedding labour as it catches up with world standards of productivity.

How much policy space still exists under the WTO? A comparative study of the automotive industry in Thailand and Malaysia

ABSTRACT This paper investigates the policy space open to developing countries under the WTO regime. It is apparent that industrial policy options in developing countries are limited by the TRIPs, GATS, TRIMs and SCMs agreements under the WTO. However, policy options are not fully closed, and a narrower range of policies is still available. Focusing particularly on TRIMs, this paper examines the contrasting development of the automotive industries in Thailand and Malaysia, showing the different ways these countries have carved out new industrial policies within the now available policy space.

Affirmative Action and Economic Liberalisation: The Dilemmas of the Malaysian Automotive Industry

Abstract: This paper considers the ways in which Malaysia has tried to develop automotive production through promoting a nationally owned car producer, Proton, and to carve out some “policy space” to continue a degree of protection whilst also liberalising its trade regime. We show that protection has not yet succeeded in making Proton and its many vendors internationally competitive, and why Malaysia has found that it has to secure the cooperation of a major automotive multinational to upgrade and to achieve export success.

Commodity prices and appropriate technology‐some lessons from tin mining

This paper looks at the economics of the choice of technique in a developing country (Malaysia) as between a labour‐intensive, locally developed method of production (gravel pump tin mining) and a capital intensive method (tin dredging) developed by foreign firms. The ‘appropriateness’ of each technique is evaluated by cost‐benefit analysis, which finds that rankings by private and by social profitabilities are sensitive both to the discount rate (as one might expect) and (rather surprisingly) to the product price. The paper suggests these findings constitute a new argument in favour of schemes to stabilise primary commodity prices.

Liberalization, Industrial Nationalism, and the Malaysian Automotive Industry

Abstract This paper examines the attempts by Malaysia to foster production by national automotive producers in a global industry dominated by a small number of major multinationals. Despite the use of a wide range of industrial policies, both standard import-substituting ones and more targeted policies, the main national producer, Proton, has been unable successfully to enter the automotive global value chain. We argue that Malaysia is probably faced with a choice of accepting foreign majority ownership, as with its second national producer, Perodua, or reconciling itself to Proton lagging in both technology and marketing.

Dawn of Industrialisation? The Indonesian Automotive Industry

This article traces the development of industrial policy towards the Indonesian motor industry within the automotive global value chain. Showing the current dominance of Japanese motor assemblers in Indonesia, it notes the rather undeveloped nature of the locally owned supporting industry, particularly compared with that of neighbouring Thailand. Most investment in auto-parts production has been by foreigners. Nevertheless, Indonesias rapid domestic-market growth has allowed it to attract foreign automotive investment without having to offer excessively generous incentives. While the continued entry of foreign suppliers of auto parts into Indonesia offers opportunities for local suppliers to upgrade their productive capabilities, it also limits their chances of becoming first-tier suppliers themselves. Japanese automotive investors are optimistic about Indonesias export potential, more so than Malaysias.

The tin industry since the collapse of the International Tin Agreement

Abstract After the sharp fall in the price of tin in the 1980s, intensified by the collapse of the International Tin Agreement, the world tin mining industry has been restructuring. The long established tin exporting industries of South-east Asia, used to earning high mineral rents, have been struggling for survival, while Brazil has emerged as a dominant low cost producer. Sales from Brazil and from China have done much to make ineffective the supply rationalization efforts of the Association of Tin Producing Countries, and a recovery of tin consumption in industrialized and developing countries has been partially counteracted by falls in import demand by Eastern Europe. Most mining multinationals have left the industry, and the state owned mining enterprises in Indonesia and Bolivia are being reorganized.

Malaysia's tin supply problems

Abstract The sharp decline in Malaysias tin output has become a matter of serious concern. The mining industry has blamed ‘penal’ tax rates for the decline in development, but more important in discouraging new investment and prospecting are difficulties in obtaining new mining leases, and the insecurity created by government plans to restructure asset ownership so as to increase indigenous Malay participation.