Minister and Chairman of the Government Office Mai Tien Dung said the Vietnam government has recognised that developing the digital economy is one of the key tasks in enhancing the competitiveness of the economy.
With that in mind, the government is aiming to create a national database system and launch a national public service portal that connects with local portals to monitor and enhance public service delivery.
The idea of building an e-Government started in 2000. In September 2018, a National Commission for e-Government was established whose objective is to move towards having a digital economy and digital society. After 18 years, quite a lot of positive changes in technology application have been reported in most administrative offices nationwide.
Information technology has been applied in public administrative service centres in 39 out of 64 cities and provinces across the country. In these localities, state agencies now share data with each other, most notably in the fields of taxation, customs services, social insurance and healthcare. However, it is still not at the desired level.
Data Fundamentals critical in the success of rolling out E-Government strategy
Sharing data is not a new issue, but a very important one for Vietnam government as it enables the formation of close links between the central Government and local governments. Although, there is still a long way to go.
There are many issues that need to be addressed. First is an institutional issue, currently the government has no framework or regulations on what type of documents that administrative Government agencies should be sharing.
Secondly they do not have “foundation data” for e-Government, even basic national data on the population or land. And what they do have in not always in electronic format. And thirdly they need to ensure a secure foundation for all data.
“In Vietnam, we’ll have a fully fledged e-Government soon. However, at the beginning, we’ll focus efforts to put the information into electronic format. For example, we have already launched the National Single Window, the ASEAN Single Window, and the establishment of public administrative centres in cities and provinces nationwide.” said Mr Mai Tien Dung in a recent interview.
Government uses own experience and international success stories to create national database proposal
He also stated that with lessons learned from other countries and from their own country, they have come up with a proposal on the creation of a national database to submit to the Prime Minister for approval.
Centralised database to make government more efficient
The minister said that he was confident that when the e-Government is fully operational, it will help save a lot of time on meetings and paperwork.
For the time being, we should develop a centralised database as soon as possible as at present, many of our data sets are being maintained separately by different Government agencies.
He also remarked that “what’s more important is the Government wants to provide public services to the public online.”
Invest Hong Kong (InvestHK) co-organised a webinar with the Moscow Chamber of Commerce and Industry (MCCI) on 7 April 2021) to update Russian companies on Hong Kong’s latest business environment under the new normal, and encouraging them to tap the business opportunities arising from the Guangdong-Hong Kong-Macao Greater Bay Area (GBA) development.
Speakers at the webinar provided Russian companies with the latest information on business opportunities in Hong Kong regarding retail, e-commerce and import trade. They also highlighted how the city can tap opportunities amid rapid changes related to the world’s digital transformation in the face of the global pandemic.
The event started with welcoming remarks by the Vice President of MCCI followed by a video presentation on Hong Kong under the new normal. This included business opportunities, challenges and prospects from the Associate Director-General of Investment Promotion at InvestHK.
He said that the pandemic has fuelled a digital transformation globally and Hong Kong is ready to benefit. The Hong Kong SAR Government is committed to promoting the development of innovation and technology (I&T), with a special focus on research and development, state-of-the-art I&T infrastructure, a tech talent pool, investment funding and other support measures to improve the ecosystem for start-ups.
Russian companies can leverage the city’s sophisticated technology ecosystem to meet the growing demand for digital marketing and technology-related services in the Mainland and across the region.
He added that the GBA development offers huge business opportunities to Hong Kong in various areas. He urged Russian companies to set up a presence in Hong Kong and make use of the city’s status as an international finance centre, the low and simple tax regime, its robust common law legal system and vibrant business environment to expand into the lucrative Mainland market.
InvestHK’s Principal Consultant in Moscow told the webinar, “Through this webinar, we aspire to unveil the unparalleled advantages that Hong Kong grants to all sorts of entrepreneurial minds and daring corporations eager to expand into Asia and globally with all our expertise and care.”
An Entrepreneur and the Founder and Managing Director of a venture studio and consulting firm, based in Hong Kong and Co-Founder of Digital Week Online, a Business Development Specialist also shared his experience in doing business in Hong Kong, highlighting the business opportunities in retail, e-commerce and importation to Hong Kong.
InvestHK is the department of the Hong Kong Special Administrative Region Government responsible for attracting foreign direct investment and supporting overseas and Mainland businesses to set up or expand in Hong Kong. It provides free advice and customised services for overseas and Mainland companies.
Hong Kong: an emerging tech hub
Hong Kong is rapidly emerging as a regional tech hub. Key IT infrastructure includes Hong Kong Science Park and Cyberport.
Hong Kong Science Park aims to transform Hong Kong into the regional hub for innovation and technology development. Home to 600 technology companies and about 13,000 technology talents, Science Park is a complete ecosystem that connects stakeholders, nurtures talent, facilitates collaboration, and drives innovation for commercialisation.
A leading information and communication technology hub in the Asia-Pacific region, Cyberport is a creative digital community of over 900 digital tech companies engaged in various forms of digital technology, such as FinTech, eCommerce, IoT/Wearables and Big Data/Artificial Intelligence.
More data centre and warehouse developments will qualify as state significant developments (SSDs) in NSW under planned changes to the state’s planning approvals process. The reforms, which come into effect in June, will temporarily lower the threshold for facilities to be assessed as SSD for two years to fast-track approvals and stimulate economic activity.
SSD is a type of development deemed important due to its size, economic value or potential impact, requiring Independent Planning Commission or ministerial sign-off before it proceeds. Proposals are assessed by the Department of Planning, Industry and Environment, instead of local councils.
The threshold for data centres will fall “from $50 million CIV [capital investment value] to 10 megawatts total power consumption (which roughly equates to a CIV of $40 million)”. Warehouses, on the other hand, will fall from “$50 million CIV to $30 million CIV for a two-year period” before reverting to $50 million CIV. The department said the changes will “more accurately” reflect the scale, complexity and potential impact of data centres and warehouses, providing a “clear and more certain planning pathway”.
The Planning Minister stated that the reforms would allow projects to travel through the planning system more quickly at a time when demand for data centres and warehouses is increasing. “During the pandemic, there has been a noticeable shift closer towards e-commerce, remote working and cloud storage which has led to an increase in data centres and warehouses. These are great for stimulating the economy – they’re simple to build, simple to assess and create a higher number of direct and indirect jobs,” he said.
Data centres and warehouses represent a $4.9 billion pipeline of projects so by lowering the threshold to assess more of them as SSD, the NSW Government is pushing them through the planning system more quickly. The Minister added that the number of planning assessment officers would also be boosted to help manage the demand as a result of the changes.
The SSD assessment pathway reforms come as the department plans further changes to the SEEPs to streamline the delivery of smaller data centres through the complying development pathway. The pathway offers an accelerated approvals process by the council or an accredited certifier for “straight forward developments”, as long as they “meet strict construction and building standards”
It follows a noticeable increase in the number of data centre development applications, particularly using the regional development of SSD pathways. “This means we’re making it easier to build small-scale data centres without lengthy planning approvals while providing a swifter pathway for large scale ones,” the Minister said.
Each data centre development is estimated to contribute up to $1 billion in construction and fit-out costs to the NSW economy. The Managing Director of an Australian cloud, data centre, government cybersecurity and telecom company said that the reforms were “really practical” and would “support NSW’s short-term economic recovery”.
His company has invested more than $200 million in the past year alone building two facilities. The firm is proud to be part of that economic rebuild and look forward to continued partnership with the state and federal government to do more, he added.
The Managing Director of Australia’s branch of the world’s largest data centre and colocation infrastructure provider also welcomed the announcement. “With eight data centres in the state today, any legislative changes that speed up the planning system is an important step forward,” he said.
The government approved setting aside THB 3 billion (approximately US$ 40 million) this year to finance digital development. The Permanent Secretary of the Digital Economy and Society (DES) Ministry, said the Digital Economy and Society Development Fund Management Committee chaired by the Deputy Prime Minister approved a framework to use THB3 billion in the fiscal 2021 budget to support six projects relating to digital development.
Those projects include plans to apply digital technology to promote education among youth, the elderly and the workforce, as well as building up an IT network in hospitals nationwide to provide better medical services.
Under the digital development plans, the government also aims to use digital technology to promote the agriculture sector and increase the value of products, generating more income for farmers. Digital technology is also applied under the plan to upgrade government services. It was noted that the committee set guidelines for a spending plan of THB 500 million (roughly US$ 16 million) allocated last week to drive 5G technology.
The National Digital Economy and Society Committee’s meeting chaired by the prime minister recently approved THB 500 million from the Digital Economy Fund to develop nine pilot projects using 5G technology.
They comprise seven projects worth THB 350 million (around US$ 11.2 million), mainly concerning smart farming, smart water management and smart city development in selected provinces, and two schemes worth THB 150 million (roughly US$ 4.8 million) to promote the private sector applying 5G technology.
The Digital Economy Fund was established in 2017 as required by the Act on Digital Development for Economy and Society enacted in January 2017. The fund aims to upgrade telecom infrastructure using seed money from the government and state agencies.
Increased use of digital payments in Thailand
According to another article, electronic money (e-money) has grown in terms of spending and top-up value, driven by consumers’ financial behaviour in the digital age and social distancing amid the pandemic.
According to the Bank of Thailand, e-money spending value has continued to increase for the past five years. In 2020, the value was THB 310 billion (~US$ 99 million), rising from 276 billion (~US$88 million) in 2019, 203 billion (~US$ 65 million) in 2018, 126 billion (~US$ 40 million) in 2017 and 90.9 billion (~US$ 28.8million) in 2016. Every month, the spending value of e-money has risen in the past six months. In August 2020, the total value was THB 25.8 billion (~US$ 826,000).
The Chairman of a unit under the Thai Bankers’ Association stated e-payment via all tools, especially digital payment, surged during the pandemic. Thai consumers became familiar with digital payment during the pandemic and many of them will not return to traditional payment, he said.
During this transition, omnichannel, which covers both offline and online, is a solution for Thais. Thailand is becoming a less-cash society and the country could show signs of being a cashless society either this year or next year.
The world’s leader in digital payments, last month, unveiled its survey about consumer payment attitude. The survey found four out of five Thais (80%) have tried going cashless, on average succeeding at living for more than a week (eight days) without using cash.
The pandemic also prompted non-users to choose contactless payments over cash. Mobile contactless was most used among first-timers at 26%, followed by contactless cards (23%) and QR code (21%).
According to the study, the top three benefits of a cashless society are restricting the spread of infection (61%), no more queues at banks (60%) and facilitating tracking of financial records (59%). The study also showed the pandemic accelerated the pace at which Thailand is becoming a cashless society, with payment innovation playing an increasingly important role in people’s daily lives. The report estimated Thailand could become a cashless society by 2026, several years ahead of a previous projection of 2030.
A study made in New Zealand found the rise of virtual shopping experiences such as augmented reality and online product try-ons may soon replace the need for tactile shopping experiences, with 62% of New Zealand shoppers more likely to purchase a product they have tried on virtually.
According to the study, customers said that online shopping is convenient (68%), saves time (57%) and makes it easier to compare prices (55%). But despite its benefits, less than half of the respondents (40%) enjoy online shopping, with another 46% on the fence, stating it depends on the store.
For those who have been shopping more online due to the COVID-19 pandemic, it is the physical, real-life experiences they have missed the most about shopping in stores, such as hand-picking items (76%), trying things on (66%), testing items before buying them (53%) and face to face customer service (50%). Interestingly, tactile shopping experiences are more important to women, with 78% stating they miss hand-picking items and 71% who miss trying things on, compared with only 73% and 61% for men, respectively. On the other hand, 55% of men stated they missed in-person customer service, compared with only 45% of women.
As online retailers improve their e-commerce sites by introducing experiences such as virtual product try-ons, online shopping may become more enjoyable for users. Of the 10% who had tried on products virtually online, the majority (70%) were satisfied with their experience, with 62% stating they are more likely to purchase products they have tried on virtually.
The highest levels of customer satisfaction were found amongst those who virtually tried glasses (58%), clothing (79%), makeup (88%), shoes (67%) and watches (75%). Likewise, shoppers were more likely to purchase hair colours (67%), glasses (63%), clothing (63%), make up (81%) and shoes (60%) and watches (75%) after having tried them on virtually.
Almost one in five of all respondents (19%) believe trying on products virtually is as good as trying on a product in real life; with 22% stating they would be willing to spend more on a product if they were able to virtually try it on before purchasing.
Live chatbots, however, received mixed reviews from respondents. Just under half the respondents (48%) believed chatbots were a useful tool while a third (30%) disagreed. When it came to helping drive online purchases, 36% thought chatbots positively influenced their purchase, while 34% said they were unlikely to purchase using one. The biggest complaints about chatbots were that they were unable to solve issues (54%), they continually redirected customers to self-serve FAQs (44%) and respondents felt the chatbots blocked them from accessing a live person (43%).
Studies say that New Zealand is the 40th largest market for e-commerce with a revenue of US$3 billion in 2020, placing it ahead of Iran and behind Portugal. With an increase of 20%, the New Zealand e-commerce market contributed to the worldwide growth rate of 26% in 2020. Revenues for e-commerce continue to increase, new markets are emerging, and existing markets also have the potential for further development.
Also, market expansion in New Zealand is expected to continue over the next few years, as indicated by a Digital Market Outlook. However, it has been predicted that the compound annual growth rate (CAGR 20-24) of the country for the next four years will decrease to 7%, compared to the year-over-year (YOY) growth of 20%. This decline suggests a moderately flooded market. Another indicator of market saturation is the rise in digitalisation of businesses in the country where 61% of the New Zealand population have bought at least one product online in 2020.
The Indonesian government is eager to establish commodity market regulations, especially those related to crypto asset trading. Plans to form a dedicated crypto exchange continues to be discussed at top levels.
Deputy Minister of Trade Jerry Sambuaga acknowledged that the development of the commodity market is complex, especially for the rapid growth of crypto assets that requires the presence of regulatory tools and institutions that protect them.
The Head of the Fiscal Policy Agency, the Director-General for Financing and Risk Management and the Deputy Minister of Finance agreed on the increasingly complex development of the commodity market. There are matters of concern ranging from taxation to the impact on the national economy at large.
None the less, with its establishment a wide range of commodities can intersect with other sectors and drive development. “Especially in the new digital-based financial industry and several other derivative product developments, there are more and more contacts with related institutions and ministries,” said Jerry.
In light of this, the Ministry of Trade was coordinating intensely with a number of other ministries and agencies. Specifically, his ministry is coordinating with the Ministry of Finance regarding the Omnibus Law material in financial services, especially the new digital-based financial industry and several derivative product developments and commodity market regulation.
Both the Ministry of Trade and the Ministry of Finance want the use and trading of crypto assets to have a positive impact on the national economy. “This is what we want to synergise so that the Financial Services Omnibus Law will be able to answer regulatory challenges as well as become a forum for the development of this industry,” said Jerry.
The commodity market and its derivatives as it is known so far according to the law are under the authority of the Commodity Futures Trading Supervisory Agency (CoFTRA) which is under the Ministry of Trade.
Jerry revealed that CoFTRA plans to immediately approve the establishment of a crypto exchange. The crypto exchange will focus on protecting business actors so that relations between all parties can run well, clearly and safely.
The head of CoFTRA, Sidharta Utama, said in a webinar on the Future of Crypto Assets, that the digital money or crypto commodity exchange would be present in Indonesia in the second half of 2021.
For now, crypto trading is being carried out but there has been no implementation of regulations from CoFTRA as a regulator because there is no exchange for crypto itself. The existence of exchanges for crypto assets, according to Sidharta, is in the interest of the public, given that there are thousands of crypto assets in the world because not all of them have the same “quality”.
CoFTRA has released 229 tradable crypto-assets and 13 officially registered asset traders. Crypto-asset traders have registered with CoFTRA but have not used the platform based on institutional regulations. In the future, when the exchange arrives, these traders will have to submit submissions with additional requirements that must be met.
From the perspective of people who carry out trading activities, there will be no difference before and after the existence of crypto exchanges. However, the presence of the exchange will play a role in overseeing crypto asset trading. The exchange will also provide clearing and a medium for asset storage, said Sidharta. The institution will function to ensure accurate crypto-asset records, ensure customer funds are safe, and will also provide crypto asset storage.
Until recent digital advancements, business functioning has been difficult, said the Sales Director of a large retail organisation in Vietnam. With two hundred agents and tens of thousands of retail outlets across 63 provinces and cities in Vietnam. To manage this scale of business, the company opted for software that helps both manage and support activities.
Similarly, a biotechnology company shared that after two years of applying management technology, the company has had a significant change. Their marketing staff realised that the tech-enabled system has helped them better control their daily work and boost sales. The customer conversion rate has increased by 20%, while the problem resolution decreasing to between 1-2 hours only. The number of points of sale has been doubling every day.
Thanks to digital transformation, many businesses have overcome difficulties caused by Covid-19. This has benefited those who need the technology as well as those who provide solutions.
A new entrant in the market industry generated US$4 million in revenue in 2020 by taking advantage of the epidemic to provide digital transformation solutions to major partners in Japan.
Another major player successfully developed a distribution management solution, fully meeting the needs of monitoring, automation and sales activities. Their solution digitises the entire business process in the distribution system, helping businesses have a more intuitive and accurate view of the market, customers and their competitors.
Chairman of the Vietnam Software and Information Technology Services Association (VINASA) Truong Gia Binh, said that digital transformation is a global trend, a vital issue for countries, organisations and enterprises. The world is witnessing a strong revolution in labour productivity and user experiences with many new business models that have been formed.
No doubt, the digital transformation trend is thriving but is not easy to realise because understanding the digital economy is a big challenge. Many domestic companies have heard about digital transformation and do not know how to implement this process.
A survey by the Ministry of Industry and Trade on the readiness to apply 4.0 technology in production and business activities in 2018 showed that 61% of enterprises “stood out” in the trend, 21% had initial preparations and 16 out of 17 fields under surveys had a low level of readiness in the digital transformation process.
According to a survey of 400 Vietnamese enterprises in 2020 by the Vietnam Chamber of Commerce and Industry (VCCI) and an international trade organisation, the four main barriers in digital transformation include Lack of information about digital technology (30.4%); lack of internal manpower to apply digital technology (32.3%), fear of leaking personal and corporate data (33.9%); lack of digital technology infrastructure (38.9%), and high cost of digital technology application (55.6%).
Many businesses still think that they do not need digital transformation and all issues can be handled on paper or spreadsheets. However, they need to consider the future development direction and future scale. Without determining digital transformation early, they will be in trouble later said a digital solutions provider.
According to the White Book on Vietnamese Businesses 2020, small and medium-sized enterprises account for 98% of the total number of corporates in the country. They have many advantages in digital transformation thanks to their flexibility and fast change. They need to understand how large enterprises operate, their business models and transformation processes, and apply them flexibly and creatively.
Digital transformation can be a smooth process as there is a lot of good technology, good infrastructure, good human resources and expertise available. Of course, these Vietnamese businesses will face teething issues when first starting, but they experience long-term gains and this will result in stronger motivation. Therefore, these businesses need the support of tech companies that specialize in digital transformation.
With the theme “Accompanying businesses in the digital era”, Vietnam Expo expects to bring resonance to the National Digital Transformation Program, creating a forum to connect the business community and enable their approach to digital transformation solutions to increase competitiveness in production and business.
Digital payments could account for 71.7% of the total payments volume by 2025, leaving cash and cheques at 28.3%, according to a recent report. Last year, the transaction volume share in India stood at 15.6% and 22.9% for instant payments and other electronic payments, respectively. Paper-based payments had a considerable share of 61.4%, the report said.
More than 70.3 billion real-time payments transactions were processed globally in 2020, a surge of 41% compared to the previous year, as the COVID-19 pandemic dramatically accelerated trends away from cash and cheques towards greater reliance on real-time and digital payments, the report stated.
During 2020, India was ahead of countries such as China and the US. The country processed 25.5 billion real-time payments transactions, followed by 15.7 billion in China, 6 billion in South Korea, 5.2 billion in Thailand, and 2.8 billion in the UK. Among the top ten countries, the US was ranked ninth with 1.2 billion transactions.
By 2025, the share of volume by instant payments and other electronic payments, however, is expected to rise to 37.1% and 34.6% respectively. Leaving the volume of paper-based transactions at 28.3%. Furthermore, by 2024 the share of real-time payments volume in overall electronic transactions will exceed 50%.
The report also estimated that by 2024, the share of real time payments volume in overall electronic transactions will exceed 50%. An industry expert explained that India’s journey of creating a digital financial infrastructure can be characterised by collaboration between the government, the regulator, banks, and fintech. This helped advance the country’s goal to achieve financial inclusion and provide rapid payment digitisation. The pandemic has further accelerated digital payment adoption with many first-time users adopting electronic payment systems.
A news report noted that India’s digital payments market surged during the pandemic even as incentives such as cash backs, rewards, and offers helped businesses to attract more customers. Moreover, policy frameworks such as Pre-Paid Instruments (PPI), Universal Payment Interface (UPI) by the NPCI apart from Aadhar, and the launch of BHIM-app have driven the financial inclusion and improved the payment acceptance infrastructure in the country in the past few years.
As the industry evolves, it is estimated that economies will witness increased adoption across different users and volume growth will be driven by recurring payments, transit payments, and cross-border transactions. As the pandemic continues to drive changes in consumer and business behaviours, banks, merchants, and intermediaries across the payment ecosystem are responding rapidly, prioritising the shift to digital platforms to protect current revenue streams, and search for new ones through a fully digitised customer experience.
With millions of people globally having to change the way they work and live – and the way they shop and pay – mobile wallet adoption rose to a record high of 46% in 2020, up from 40.6% in 2019 and 18.9% in 2018. Countries like Brazil, Mexico, and Malaysia where many people historically relied on cash are now some of the fastest adopters of mobile wallets. An official said that the pandemic has cast the spotlight on the importance of digital payments and robust payment infrastructures, condensing a decade of anticipated innovation into one year and creating human behavioural changes that will not reverse as the world emerges from the crisis.