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VIETNAM’S FUTURE DIGITAL ECONOMY TOWARDS 2030 AND 2045

published by CSIRO

The next wave of digital technologies has the potential to transform Vietnam into Asia’s next high-performing economy, and to bring up the living standards of all Vietnam’s citizens over the coming decades.

There is good reason to believe that this transformation will occur: there has been a recent boom in both digital hardware and software exports, Vietnam’s young population is rapidly taking-up new mobile internet services, and the Vietnam Government is implementing wide-reaching Industry 4.0 policies to jump start the modernisation of Vietnam’s major industries and grow new industries.

But to sustain high growth, Vietnam will need to overcome substantial challenges. The population is ageing, climate change and rapid development is straining the environment and food production, and the nation is rapidly urbanising. The workforce needs to upskill – especially as jobs are automated across the agriculture and manufacturing sectors. All of these factors will test Vietnam heading into the future but the primary challenge for policy makers will be to allocate resources efficiently to ensure low debt, as well as inclusive and sustained growth.

The year 2019 signals a new era of policy and strategic direction in Vietnam. This report aims to serve as a strategic decision-making tool for leaders in government and business negotiating the new wave digital innovation and the next phase of economic development.

Mastering the digital economy creates an opportunity for Vietnam to maintain rapid and sustainable growth through the next phase of development. Strong leadership and institutions will be key in Vietnam’s development across all economic sectors including the private sector. Digital transformation resulting from this strong leadership will unblock bottlenecks to promote further economic development.
— Dr Nguyen Van Binh, Politburo Member, Secretary of Party Central Committee, Chairman of the Central Economic Commission

The next 25 years represents a decisive window of opportunity for Vietnam to transition to a more digitalised economy and escape the middle income trap. The success and speed of that transition depends greatly on the profile of the workforce of today, and the workforce is ageing rapidly. Strong national leadership, institutions and policies are needed now to create collective upskilling – across the workforce and society – and enable a successful digital transformation.
— Mr Nguyen The Trung, Managing Director of DTT Group

This is an excerpt from the “Vietnam’s Future Digital Economy – Towards 2030 and 2045 report”

Megatrends

Seven megatrends are expected to drive the development of Vietnam’s future digital economy, leading to the four potential future scenarios described in this report.

  1. Emerging digital technologies

    Emerging digital technologies such as blockchain, Artificial Intelligence, big data analytics and the Internet of Things can leapfrog industry infrastructure upgrades, simplify supply chains and logistics and help businesses operate more efficiently.

  2. A smaller world – internationalisation

    The digital economy can benefit from international integration – by opening Vietnam to new export markets, knowledge and skills transfer, and greater levels of foreign investment.

  3. Increasing need for cybersecurity and privacy

    There is greater need for cybersecurity and privacy as more businesses and consumers engage in the digital economy, and as critical systems such as finance and government are increasingly digitalised.

  4. Modern digital infrastructure

    A strong digital economy requires reliable digital and energy infrastructure – especially for power-intensive technologies such as IoT or AI. New telecommunications networks are also needed to ensure broadband is available to carry the large amounts of digital data needed for new applications.

  5. The push to smart cities

    In a rapidly urbanising and ageing nation, smart cities provide opportunities to use infrastructure and resources more efficiently, as well as reduce waste, pollution and traffic congestion.

  6. Rise of digital skills, services, gigs and the entrepreneur

    Increasing demand for the services sector as well as digital products and services mean there is a need to invest further in higher education, digital skills, entrepreneurial skills and Vietnam’s innovation ecosystem. Platforms and the trend away from secure, structured and long-term work is also driving the use of labour and product platforms for income generation and creative avenues for industrial transitions in labour markets.

  7. Changing consumer behaviours – digital tribes, influencers, higher value consumption

    Consumer behaviours are changing as the Asian middle classes emerge and orient to higher-value goods and services, including those from the digital economy. At the same time, higher digital adoption among consumers increases the influence of digital tribes and influencers – both on suppliers and consumer behaviour.

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