Vietnam’s Digital Transformation: A Bright Future Ahead

According to a recent projection from Google Research, digital transformation could inject approximately $74 billion (around VND 1,733 trillion) into Vietnam’s economy by 2030. This vision highlights Vietnam’s goal to become a leading technology center in Asia, drawing in businesses and startups from all corners of the globe.

During a recent forum, Do Tien Thinh, the Deputy Director of the National Innovation Center (NIC) under the Ministry of Planning and Investment, pointed out that Vietnam holds a strong position in leveraging artificial intelligence (AI).

“The country benefits from a youthful and digitally literate population with a solid educational background. Additionally, it boasts the second-fastest-growing digital economy in Southeast Asia. The government is also pushing forward with policies designed to promote the adoption of digital technology,” Thinh remarked.

Thinh further stated that there is ample opportunity for AI applications across various sectors in Vietnam, including agriculture, food, retail, education, finance, healthcare, and infrastructure.

For South Korean tech companies looking to invest in Vietnam, sectors such as transportation and healthcare present particularly promising avenues for AI-based ventures.

He also highlighted the encouragement of data-sharing between public and private entities to stimulate business innovation. This transparent approach, alongside a welcoming policy landscape and a skilled workforce, positions Vietnam as an appealing destination for AI startups.

“Vietnam ranks second among six Southeast Asian nations regarding AI startup potential. While Singapore leads with 44% of the region’s AI startups, Vietnam follows at 27%, significantly ahead of Indonesia and Thailand,” Thinh added.

Vietnam is advancing AI development through three key strategies:

• Establishing a robust AI ecosystem.
• Enhancing AI skills within the workforce.
• Creating an encouraging environment for the next generation of AI innovators.

To promote investment, Vietnam offers various incentives for startups focused on high-tech and AI initiatives, such as four years of corporate income tax exemption and reduced taxes for an additional nine years.

Several provinces are also experimenting with tailored regulatory frameworks (sandboxing) for emerging technologies, including AI in the finance sector. In the past two years, Vietnam has enacted two resolutions and one special law that enable Hanoi, Ho Chi Minh City, and Da Nang to implement sandbox models inspired by Singapore.

The country is committed to developing its AI ecosystem with a strong emphasis on nurturing human resources and AI platforms. The Ministry of Planning and Investment has partnered with Google to launch the “AI Space” platform, offering startups free access to cloud services and digital tools. This initiative could save startups an estimated $350,000 over a two-year period, providing substantial financial support to bolster their growth in Vietnam.

The upcoming 2024 Vietnam-Korea Digital Cooperation Forum is part of the International Digital Week, organized by Vietnam’s Ministry of Information and Communications (MIC). The forum’s goal is to facilitate Vietnam’s learning from South Korea’s cutting-edge approaches and successful digital strategies, helping to bridge the digital gap, empower marginalized communities, and create collaborative business opportunities for both nations.