Clusters and Economic Growth in Asia

Clusters and Economic Growth in Asia

Edited by Sören Eriksson

This detailed book explores and provides insights into the development and transformation of various clusters, economies and industrial sectors in East and Southeast Asia.

Chapter 6: Technological intensity of FDI in Vietnam – implications for future economic development and emerging clusters

Curt Nestor

Subjects: asian studies, asian development, asian economics, asian urban and regional studies, development studies, asian development, economics and finance, asian economics, economics of innovation, geography, economic geography, innovation and technology, economics of innovation, urban and regional studies, clusters, regional economics


Strategically located in Southeast Asia, in the midst of a most dynamic economic region, Vietnam embarked on an ambitious economic reform programme at the end of the 1980s. The reforms included foreign direct investment (FDI) policies with the aim of promoting economic development through technological transfer and employment generation. Over the past two decades, the country has achieved a most remarkable economic development that has radically transformed the economic landscape. The foreign invested sector has made substantial contributions to the average GDP growth rates, which exceeded 7 per cent during the period. The economic growth has been broad-based and has led to improved living standards for large parts of the Vietnamese population of 89 million. The nominal GDP per capita was recorded at less than USD 100 in the early 1990s, but Vietnam reached the status of a (lower) middle-income country with a GDP per capita of USD 1000 in 2008. The Vietnamese government aims to achieve the status of a modern and industrialized country by 2020. This chapter first provides a brief outline of the theoretical underpinnings of industrial agglomerations and clusters and the potential role of FDI in the transfer of technology in developing countries.

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