Prime Minister Drives Digital Transformation
Vietnam is targeting digital transformation as one of the engines of its next stage of socio-economic development. From e-commerce to telecommunications and semi-conductors to cashless transactions, digitalization is high on the agenda.
Speaking at the National Committee for Digital Transformation on 24 April, the Prime Minister once again emphasized the importance of the so-called ‘fourth industrial revolution’ and called for the creation of a “comprehensive legal corridor” to drive national digital transformation.
The Prime Minister’s remarks also contained some important insights into Vietnam’s progress on digitalization. These will be of interest to foreign enterprises or international investors in the digital sector or dependent on strong digital infrastructure considering entering the market.
Vietnam’s progress towards digitalization
One of the most notable figures to stand out from the speech was that 80 per cent of administrative procedures for business are now available online. Paper-based procedures are a financial and time burden to companies, so this is a positive step to streamline and reduce the cost of doing business.
The IT sector as a whole is also showing promising growth. Revenues rose over 17.5 per cent in quarter one to reach more than USD 36 billion. Meanwhile, the export of IT products saw 17 per cent growth to reach USD 31 billion.
The digital economy is taking a growing slice of the national economic pie. It has risen from 11 per cent of GDP in 2021 to 14 per cent of GDP in 2022 and 16 per cent of GDP in 2023. To put this in perspective, the digital economy is growing three times faster than the national rate of GDP growth.
Strategic priorities for the digital economy
However, despite this progress, there is more to do. In that spirit, the Prime Minister highlighted three strategic priorities for the government: (i) strengthening institutions, in particular those related to digital transformation; (ii) improving human resources, and; (iii) investing in digital infrastructure.
Meanwhile, the 2024 action plan of the National Committee focuses on the following four areas: (i) the IT sector; (ii) the digitalization of economic sectors; (iii) digital governance, and; (iv) big data. This action plan is intended to help the government achieve its 2025 National Digital Transformation Program.
This focus on digitalization has clear benefits for investors and companies doing business in Vietnam. However, business leaders do need understand some important implications for their projects, such as the cross-border regulations covering e-commerce or the provisions of the Personal Data Protection (“PDP”) Decree.
For more information about these decrees, or the other regulations affecting companies in the digital space, just contact our team on: contact@apflpartners.com
Disclaimer: This article and its content are for information only and are not given as legal or professional advice. they do not necessarily reflect all relevant legal provisions with respect to the subject matter. Readers should seek legal or professional advice before taking or refraining to take any action.
