Post-liberalisation Paradox in Textile Industry: A Comparative Study of Vietnam and Tanzania

Abstract

The study examines post-liberalisation paradox in textile industry. It compares Vietnam and Tanzania. Data were collected through in-depth review of information and interviews with actors in the textile commodity chain. Results show that the performance of textile industry in Vietnam has expanded rapidly while Tanzania’s contracted sharply after economic liberalisation. Some of the factors that explain this divergence include the approach to economic liberalisation and institutional and technological aspects. The main observation is that while Tanzania pulled out abruptly and haphazardly and allowed its factories to collapse, Vietnam continued state ownership of factories by establishing a state parastatal to nurture and promote the sector. It is recommended that the government should consider intervening in the sector by building and operating large scale textile factories alongside those operated by the private sector.