The paper discusses technological capabilities in Vietnamese industry considering
mainly the role of foreign companies. The support of technological change is limited
by specific disadvantages of Vietnamese environment, mainly insufficient
organizational and legal shortcomings. Thus the connections between foreign and
local companies did not produce expected results. The diffusion of technological skills
takes place via training process, transfer of tacit and codified knowledge, spillover to
local partners and influence absorption capacity of the local market. The cases of ten
foreign companies from five different countries are presented. Major conclusions
underline the threats of global operations of international companies when they are
not supported by enlightened policies of companies and governments in host
countries on one side and present the opportunities for these countries economy on
the other.