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Vietnam to Speed Up Digital Transformation for Socio-Economic Development

According to a recent report, Vietnam will need to do more if it wants to become a digital powerhouse as envisioned in the socio-economic development strategy adopted by the Party in February 2021. A biannual update on Vietnam’s economic performance showed that the country needs to ensure the development of a digitally skilled labour force, the emergence of a dynamic and agile local private sector, and good but secure access to information.

The report reviews the recent developments in the Vietnamese economy and discusses the economy’s short to medium-term prospects, highlighting domestic and external risks associated with the COVID-19 pandemic. The report said that to improve its economic autonomy, Vietnam needs to take advantage of existing conditions to become a digital powerhouse.

While downside risks have heightened, economic fundamentals remain solid in Vietnam, and the economy could converge toward the pre-pandemic GDP growth rate of 6.5% to 7% from 2022 onward. Vietnam aims to be among the top 50 countries in the ICT Development Index as early as 2025, and its digital economy is hoped to account for one-third of the country’s GDP by the end of the decade, instead of only 5%.

For Vietnam, digital transformation is happening in Vietnam and the COVID-19 shock is a big driving factor. Since the appearance of the COVID-19 pandemic, Vietnam has witnessed a great change in the application of new digitisation tools in both the private and public sectors. It is estimated that in June 2021, about two-thirds of private enterprises in Vietnam had access to technologies related to the digital economy. This is a huge leap from the pre-COVID-19 period.

However, Vietnam still has a lot of work to do. In addition to upgrading infrastructure, the country needs to encourage the application of digital technology and attract investment to create conditions for small businesses to participate in the digital economy. Vietnam also needs to upgrade digital technology infrastructures, and equip workers with digital skills to help them become more dynamic in adapting to new technologies.

In the short term, Vietnam can take advantage of the presence of many famous technology enterprises to learn and improve digital skills for local labourers working for these corporations. The Vietnamese government can issue a series of initiatives to attract talents from expatriates working in digital technology fields around the world.

Recently, the Prime Minister issued a document to the Ministry of Science and Technology on restructuring national-level science and technology programmes for the 2021-2025 period and towards 2030. In the document, the ministry is assigned to coordinate with other ministries, agencies, and localities in proactively formulating plans and organising the work.

The ministry must base itself on the ten-year socio-economic development strategy for the 2021-2030 period and the guidance on taking enterprises, institutes, and universities as research entities; ensuring the principles of publicity, transparency, and fairness. The objectives and results of the programmes are to improve product quality and competitiveness of Vietnamese enterprises in the domestic market; to expand foreign markets for advantageous industries; to improve the global innovation index (GII); and to prioritise the promotion of the development of economic models. The document also specifies the number of priority research fields such as social sciences and humanities, natural sciences, industry, agriculture, health, natural resources, and the environment.

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