Impact of Cloud Computing and AI on Economic Growth in Vietnam

Cloud computing and artificial intelligence are crucial in driving economic development and innovation. A 2023 McKinsey report forecasts a 10% annual increase in the global data center market until 2030, predicting total expenditures to reach $49 billion.

AI, particularly Generative AI, has seen rapid adoption, far outpacing other technologies that typically take 2-4 years to gain popularity; Generative AI only requires about a year to make a mark.

A recent report indicated that Vietnam’s cloud computing service sector is expected to reach a valuation of $1.2 billion by 2030, with an annual growth forecast of 11-12%.

Despite achieving the highest growth in Southeast Asia and ranking third in Asia with a 19% growth rate in 2023, Vietnam’s cloud market size is still notably smaller, only one-fifteenth of Singapore’s and one-fifth of those in Indonesia and Malaysia. This suggests Vietnam has significant work ahead to keep pace with its neighbors.

One critical issue is the shortage of a skilled workforce in cloud computing and AI. To enhance its talent pool, Vietnam must prioritize workforce skill development.

This digital workforce issue is common across many Asian nations. Jeff Johnson, CEO of Amazon Web Services (AWS) ASEAN, remarked that Generative AI has the potential to transform numerous enterprises, with 10% of organizations making investment plans in this domain.

However, many companies in the Asia Pacific, about 70%, report difficulty in finding qualified personnel for AI roles.

Emmanuel Pillai from AWS highlighted the existing skills gap in Vietnam concerning cloud computing and AI. He emphasized the necessity for skill enhancement and partnerships with both private and public sector employers to develop digital competency.

Nguyen Huy Dinh, a cloud computing engineer, pointed out that salaries for cloud computing professionals in Vietnam are 10-20% lower than in other Southeast Asian countries, largely due to differences in living standards. He noted that self-education, adaptability, and willingness to learn are vital for Vietnamese engineers to compete globally.

The talent shortage in cloud computing and AI presents challenges but also a significant opportunity for Vietnam to craft its digital future.

During the AWS Cloud Day Vietnam event on September 18, Ho Duc Thang, acting director of the National Digital Transformation Agency, emphasized that digital transformation is reshaping global landscapes. There is an increasing reliance on cloud services and data infrastructure to foster economic growth, optimize services, and drive innovation.

He asserted that the agency views cloud computing and AI as crucial to its objectives. Implementing these technologies will enhance government agencies’ ability to manage and utilize data efficiently, expediting Vietnam’s journey toward a digital future.

According to Thang, cloud computing is essential in the digital transformation journey, offering scalable, flexible, and effective systems. By leveraging cloud solutions, organizations can adapt swiftly to market demands.

AI’s role in digital transformation is equally significant, enhancing operational efficiency and automating processes, while also revolutionizing public services and improving government efficiency.

Vietnam is taking steps to incorporate AI within the public sector, seen through smart city applications and virtual assistants available to both civil servants and citizens. The country is prioritizing the development of digital and AI competencies within its workforce. This digital skill set is vital for ensuring that technologies like AI and Generative AI foster creativity, efficiency, and sustainability.

In a notable advancement, the Post and Telecommunications Institute of Technology (PTIT) has announced plans to establish an AI Faculty, marking the first AI program at the higher education level in Vietnam.