The Impact of Foreign Direct Investment on State-Owned Enterprises Reform
نویسنده
چکیده
The increasing speed of globalisation has created both opportunities and challenges to many transitional economies. This paper analyses the impact of foreign direct investment (FDI) on the productivity of the State-Owned Enterprises (SOEs) and concludes that SOE reform is inevitable. The SOEs’ obligations to provide social welfare should be removed to enable them to compete on an equal footing with foreign firms. Moreover, it is essential to build a social safety net to assist the losers in this reform. These policies will facilitate the transition from central planning to open market economy without triggering devastating unemployment and social instability. JEL classification: F23, O19, O53, P33
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