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Digitalisation Key to Vietnam’s Economic Recovery

Policymakers and business experts at a conference discussed how digitalisation is key to Vietnam’s economic recovery and crucial to Vietnamese firms’ ability to compete and create value. The experts explored how the country’s economic policies can help foster creativity and innovation among the business sectors. The Deputy Head of the Department for Enterprise Development under the Ministry of Planning and Investment, Bui Thu Thuy, noted that digitalisation was no longer an option for businesses, especially as the world is still trying to recover from the pandemic. The digitalisation of business data, management, automation, reporting, and collaboration within enterprises should be given the highest priority.

While Vietnam enjoyed a relatively high broadband penetration rate compared against other countries in the region, digitalised transactions remained at just over 22%, lower than Indonesia (34%) and Thailand (62%). Online business transactions were also on the low side at just 10% against Indonesia (49%) and Malaysia (52%).  According to a news report, the most common issues experienced by Vietnamese businesses with digitalisation include a lack of financial resources, poor IT infrastructure and cyber security, and a shortage of skilled workers.

The pandemic and a number of recently implemented policies by the government have sped up digitalisation. Coupled with a change in consumer behaviour to contactless transactions, the country’s digital economy has reported a 10% growth rate since last year and US$135 billion in sales volume. The Deputy Head stated that the Ministry is willing to provide support to all businesses to make the transition to digital. Several tools have been made available on a government portal to help businesses self-evaluate and build a digitalisation strategy. The Ministry has also been building a consultant network specialised in digital transformation. So far, the network has connected with over 100,000 clients and held numerous training programmes for businesses.

The General Director of V-startup, a support network for Vietnamese start-ups, explained that enterprises are at the core of the country’s creativity and innovation push. Creative and innovative solutions in organisation and management help businesses cut down transactional and operational costs while improving productivity and efficiency. Creativity and innovation must come from an emphasis on business culture, one in which managers and workers must continue to adapt and change, the General Director added.

An industry expert said the push for digitalisation offers the country an opportunity to move in the direction of greener development and to build an economic ecosystem for sustainable development. Dr Chu Duc Hoang, from the National Technology Innovation Fund, said that Vietnamese enterprises, especially small and medium-sized enterprises (SMEs), need financial resources for research and development activities as well as comprehensive legal and policy frameworks to encourage the implementation of science and technology in the business sector.

In 2021, Vietnam recorded 5,600 newly established digital technology businesses, stemming from the need to work, sell, and communicate online amid the COVID-19 pandemic. Statistics show that Vietnam currently has about 64,000 digital technology enterprises with more than one million employees. The working environment and non-contact economy due to COVID-19 sped up and strengthened digital transformation as well as promoted the digital business community, OpenGov Asia reported earlier.

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