The Vietnam Government is looking to become a digital society by experimenting with new technologies and setting a target of having 10 big IT businesses with revenues of over US$1 billion.
Vietnam’s Prime Minister, Nguyễn Xuân Phúc, approved the National Digital Transformation Programme, which strives to completely renovate Government operations and stimulate a digital economy by 2030.
Developing a truly digital society in Vietnam
The Vietnam Government believes to truly achieve a digital society, access to Internet and mobile networks must be accessible by all communities.
Plans have been developed to provide fiber optic network infrastructure reaching out to more than 80% of households and 100% of communes nationwide by 2025.
The Government also aims to make 4G and 5G mobile network services and smartphones universally accessible as well as enable an Internet of Things infrastructure.
Vietnam is predicted to be amongst the top 50 countries in the information and communication technology development index within the next five years as well as ranking in the top 50 for global competitiveness and top 35 for global innovation.
As a result, the digital economy is forecast to make up 20% of Vietnam’s GDP.
Vietnam empowers local businesses to become global leaders
Currently, Vietnam has a large number of domestic enterprises, but 99% are small in size and have a limited ability to participate or compete in the global value chain.
The Ministry of Information and Communication rushed to build a draft decision to approve an IT development programme by 2025 with a vision to have 10 big businesses that are able to compete internationally and achieve a revenue of over US$1 billion.
Nguyen Thanh Tuyen, Deputy Head of the Ministry’s Information and Technology Department, said the programme aimed to make Vietnam’s IT industry a big economic sector with rapid and sustainable growth, based on achievements of the Fourth Industrial Revolution.
With a target of 50,000 IT and telecom firms in the country, the sector would provide momentum for the country’s digitalisation and digital economy.
The Ministry hopes the revenue growth of the IT sector would be double the country’s GDP growth, but right now 98% of total export revenue comes from Foreign Direct Investment.
To achieve this, local businesses must master software and IT services by 90% of products and solutions for e-government construction, digital transformation, transport and smart agriculture.
A software park in Hanoi’s Long Bien District is being constructed to enable this. Tran Van Dung, Vice Chairman of Tien Giang Province People’s Committee, also plans to build a software park in Mekong to to attract human resource for the IT sector
While in the hardware sector, the programme aims to have domestic IT firms produce equipment for 5G networks.
The programme also looks to have 60% of the population using locally developed social networks and 40% using domestically-made search engines.
Phan Tam, Deputy Minister of Information and Communications, said the IT, electronics and telecom sector has seen rapid development with extremely important achievements in the past five years.
IT products, especially mobile phones and computers, took first and third place among top 10 key export staples of Vietnam in 2019 with a trade surplus of $28 billion.
Software revenue for Vietnam reached US$5 billion in 2019 at a growth rate of 17.7% since 2009.
Overall, the IT, electronics and telecommunication sector creates more than one million jobs and generated a massive US$112.5 billion in 2019, which is double that of 2015.
The country is also experiencing a year-on-year growth rate of 17% in the cloud sector, bringing in US$2.4 billion. And with these advancements come the increasing need for data centers in the country.
There are around 30 data centers in Vietnam and more may be on their way to power their digital society, as the Government has invested $1.4 billion in new facilities as well as millions in local startups.
Apple announced it would build a data center in the country, confirming plans to invest $1 billion in Vietnam three years ago. The tech giant will join established data center players like CMC Telecom, Viettel IDC and FPT Telecom.
It’s an exciting time to keep watch of Vietnam’s digital industries and economy, considering the huge impact it makes to society and clear focus by the government to compete globally in the technology industry.