Technology-driven models are of primary interest among international and domestic businesses and investors in different sectors over the year, ranging from e-commerce and education to healthcare and banking.
According to a press release, in the banking and financial sector, fintech is rising with the United Kingdom, in particular, recognising the advantages in the country. As a leading global fintech hub, British companies are keen on plans to expand investment into the sector in Vietnam.
With growing interest, sci-tech and ICT have continued to be among the most attractive sectors to international investors and businesses in Vietnam during the year, despite the pandemic. As shown in statistics from the Ministry of Planning and Investment, Vietnam’s total registered FDI in sci-tech and ICT hit about US$1.25 billion in the first 11 months of 2020.
As the COVID-19 pandemic hit, several companies came to a screeching halt, with the rest having to think about new changes to survive- technology-based businesses have become the most sought after solution.
South Korea, Europe, Japan, Singapore, and others have been anticipating new opportunities from Vietnam’s acceleration of digital transformation, with ICT now playing an increasing role in the country’s economic development. According to the Ministry of Information and Communications, the country’s total ICT revenue reached over US$112 billion in 2019.
Moreover, Vietnam has made huge strides in accelerating its national digital transformation this year by issuing a number of policies in this field. In fact, the country’s tech market has been a magnet for international businesses and venture funds even before 2020. According to Singaporean-based VC firm Cento Ventures, for the first time, investment in Vietnamese start-ups has even exceeded Singapore. Funding for Vietnamese-based start-ups accounted for 18% of the total investment in the region, or US $741 million, in 2019 – a huge jump from a year earlier when it only accounted for 4%, or US$287 million.
This trend has now been further reinforced with the approval of the National Digital Transformation Programme by 2025 with a vision towards 2030, and other targets. Under this programme, the country has set the target to be named among the 50 leading countries in e-government by 2030; for the digital economy to make up 30% of GDP; and for people to be able to experience smart services in healthcare, education, banking and finance, transport, environmental protection, and energy supply.
In line with the approval, ministries, agencies, and provinces have been deploying digital transformation by building new policies and developing infrastructure to tap into their own advantages and specific characteristics.
Additionally, this is also backed by the country’s new FDI attraction strategy with high-tech as a focus to offer incentives and supporting policies, as well as the Politburo’s Resolution No.52-NQ/TW issued in 2019 on guidelines and policies to proactively participate in Industry 4.0. This includes the establishment of the Vietnam National Innovation Centre, which will offer special incentives for investment projects at the facility.
The National Strategy on the Fourth Industrial Revolution will focus on investing in advanced technology, developing infrastructure and e-government, and building on the performance of tech-related commitments in free trade agreements. It is expected to continue to drive a new business and investment wave in the months to come.
Industry insiders have noted that all of these factors motivate companies, prompting the business community to venture further into the technology market. This transformation is expected to continue at a faster speed, generating big impacts for a digital government, economy, and society.
