At the end of November 2021, Vietnam officially established the National Committee for Digital Transformation, chaired by the Prime Minister. This marks the near completion of a comprehensive national digital transformation strategy for the period 2021-2025, with a vision toward 2030. The framework includes the National Digital Transformation Program, the Strategy for Developing E-Government toward Digital Government, and the final piece—the Strategy for Developing the Digital Economy—is also being urgently finalized.
The Global Race – Southeast Asia in Comparison with Developed Countries
The Asia-Pacific region, with its young, dynamic population and passion for technology, is the most enthusiastic in the world about developing digital technologies and using the digital economy as a competitive advantage for national development. Vietnam has openly expressed its ambition to rise to the top in this race. Other countries in Southeast Asia have also quickly recognized the important role of digital technology and are striving to leverage the advantages of comprehensive digital transformation to "leapfrog," propelling their nations forward to quickly close the gap with developed economies.
Malaysia is a standout example. In February 2021, Prime Minister Tan Sri Muhyiddin Yassin unveiled "MyDigital," a 104-page strategic document outlining a comprehensive plan to develop Malaysia's digital economy by 2030. The objectives are clearly defined – to turn Malaysia into a digital-driven economy, achieve high-income nation status, and lead the region in the digital economy.
Malaysia's targets are specific for various stakeholders. For citizens, the plan aims to create 500,000 new jobs, achieve 100% household internet coverage, and ensure all students nationwide have access to online education.
For businesses, the digital economy is expected to contribute 22.6% to GDP, boost productivity by 30%, and enable 875,000 micro, small, and medium-sized enterprises to adopt e-commerce.
For the government, 80% of public services are to be delivered online, and by 2022, 80% of data is to be migrated to the cloud.
Despite these ambitions, Southeast Asia, excluding Singapore, still lags significantly behind developed countries in both strategy and practical capabilities for digital and economic technology development.
While Southeast Asia is in the initial stages of fully digitizing various sectors, developed economies have progressed into deeper stages, focusing on "core" issues of the digital economy.
From a technological perspective, the origins of digital technology remain rooted in developed nations. The concept of major social networks, which generate vast global user data, originates in the U.S. Similarly, Artificial Intelligence (AI) also began in the West in the post-World War II era, gaining momentum only with the advent of massive data sets from social networks and the Internet of Things (IoT).
Southeast Asia can rapidly adopt and benefit from new digital technologies – which spread quickly due to their borderless nature. However, the region predominantly "utilizes" rather than "creates" core technologies. Southeast Asia's tech unicorns, such as Indonesia's Grab or Vietnam's VinaGame (VNG), have succeeded by adapting new business models and quickly dominating local markets through regional expertise. However, creating new technologies, developing innovative business models, and scaling globally remain significant challenges.
While the technological capability gap is hard to quantify, the institutional gap is more evident. Developed nations such as those in Europe, the U.S., the U.K., and Australia have been addressing regulatory issues related to technology 5-10 years ahead of Southeast Asia. Key topics include privacy protection and users' personal data in the digital environment; taxes on tech companies providing cross-border digital services; digital assets; misinformation on social media platforms; and ethical AI concerns.
Simultaneously, investments in digital infrastructure (focusing on 5G and cloud computing) and researching cutting-edge technologies (such as semiconductors, and next-generation 6G telecommunications networks) remain priorities. For example, in the U.S. government's $1.2 trillion infrastructure investment package under President Joe Biden, investment in internet connectivity is a significant component. While developed nations advance with robust investments, the challenge for developing countries like Vietnam to catch up, particularly in infrastructure quality, persists.
Vietnam – What is the Key to Success?
Returning to Vietnam, having a roadmap is promising, but it alone does not guarantee success. Numerous challenges lie ahead.
With the great potential of the private sector, the biggest role for the government is to unlock this potential through reasonable policy choices. On the other hand, the government should step back and not encroach on areas that businesses can handle effectively. Specifically, Vietnam’s three priorities should be: (1) prioritizing the development and investment in digital infrastructure, including broadband internet, 5G connectivity, and cloud computing; (2) training a highly skilled workforce, focusing on digital skills for workers; and (3) urgently finalizing the legal frameworks for emerging industries and addressing new issues in the context of cross-border trade and the global digital economy, such as digital assets, personal data protection, cross-border digital services, fake news, and misinformation on social media platforms.
Finally, digital technology and the economy span multiple sectors, making inter-ministry policy coordination vital. The government must act as a central coordinator, ensuring harmonious collaboration among key ministries during policy implementation.
Digital technology and the economy are pivotal to Vietnam's economic recovery during and post-pandemic, serving as a new growth engine. Digital technology plays a crucial role in reducing transaction costs, improving the economic efficiency of existing industries, and boosting labor productivity. Emerging industries such as digital services, digital content and entertainment, and cybersecurity could become key industries contributing significantly to Vietnam's service export value. Realizing this potential requires addressing three foundational issues: national digital infrastructure; a skilled workforce for the digital age; and the legal framework for new industries in the context of cross-border trade and the global cyberspace economy.
Nguyen Quang Dong - Institute for Policy Studies and Media Development.
(This translation was provided by an automated AI translation tool)
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