Digital transformation is seen as a new breakthrough method to shorten the process of industrialisation and modernisation.

Prime Minister Pham Minh Chinh delivered this statement during the 2023 Vietnam Industry 4.0 Summit held in the capital city yesterday.

The PM said the digital transformation in Viet Nam has made significant achievements. The institutional framework for developing e-government, digital government, and digital economy has been gradually improved.

From now to 2030, Viet Nam will focus on accelerating the application of science and technology, facilitating digital transformation while creating breakthroughs in productivity, quality, efficiency, and competitiveness, he said.

The PM affirmed that the Government will continue to focus on perfecting institutions, promoting entrepreneurship and innovation in a manner consistent with the market mechanism and international practices.

Top priority will also be given to making breakthroughs in infrastructure systems, especially strategic infrastructure, creating a driving force for accelerating the nation’s industrialisation and modernisation, he added.

“Viet Nam’s process of digital transformation and green growth must take the people as the centre and the motivation and be implemented by Vietnamese people.”

“But international cooperation is indispensable, including experience in building and perfecting institutions, financial resources, modern technology, human resource training, and management science,” the PM noted.

Policy needed to promote “Make in Viet Nam”

Nguyen Hong Son, Deputy Head of the Party Central Committee’s Economic Commission, said at the seminar about enhancing smart manufacturing capacity within the framework of the 2023 Vietnam Industry 4.0 Summit that Viet Nam was facing not only opportunities but also challenges in developing smart production.

He cited a forecast from Ericsson Group that in 2025, the Asia – Pacific region would attract two-thirds of the global manufacturers, especially in smart manufacturing. Currently, seven countries in the region, including Australia, Indonesia, Malaysia, New Zealand, the Philippines, Singapore and Thailand have started to produce 5G-enabled equipment. Ericsson also viewed Viet Nam as an attractive destination with an estimated revenue from the 5G industry of around US$1.54 billion in 2030.

However, a study by the World Bank published in November 2021 revealed that 70 per cent of products in the manufacturing industry of Viet Nam used human-controlled machines, 20 per cent were manual, only 9 per cent used computer-controlled and less than 1 per cent used more advanced technology such as robotics and 3D additive manufacturing, Son said.

A report by CSIRO and the Ministry of Science and Technology pointed out that only a modest part of Vietnamese enterprises were involved in innovation activities, and the percentage of enterprises with research and development (R&D) was little. For example, only 17 per cent in electric equipment, 15 per cent in chemical production, 9 per cent in food processing, and 7 per cent in rubber and plastic.

Nguyen Thien Nghia, Deputy Director of the Authority of Information Technology and Communications Industry, said that experiences from several Asia countries which achieved success in industrialisation, including the Republic of Korea, Japan and China, showed there would be three phases in the industrialisation process.

The first phase was outsourcing and assembly to take advantage of human resources and competitive costs. The second phase was to make integrated products and join the supply chain and optimise the process. The third phase was to own some core technologies.

Nghia said that Viet Nam was still in the first phase. Thus, smart manufacturing played a very important role in the automation and optimisation of production costs.

During the past three years, the ICT industry of Viet Nam witnessed the significant development of domestic enterprises and the wave of enterprises starting to make integrated products, Nghia said, adding that enterprises actively identified the market and made long-term methodical investments in technology.

It was necessary to develop appropriate policies to encourage enterprises to invest in technology, Nghia stressed.

Phan Thi Thanh Ngoc from VNPT – IT said that the digital technology industry had large potential for growth with the growing popularity of the Internet of Things, the rapid penetration of e-commerce or the priority in investment in smart city, and the increasing use of Industry 4.0 technology such as AI, AR/VR and blockchain and 5G.

Digital technology enterprises should be put at the centre of digital technology development, Ngoc said, adding that incentive policies should be raised to promote the development of digital technologies companies, together with policies to control the quality of Make-in-Viet Nam digital technologies products and services, attract foreign investment and build talents.

Green transition

Also, within the framework of the summit, Deputy Head of the Party Central Committee’s Economic Commission Nguyen Duc Hien said that the demand for energy was growing very fast while the domestic supply was not enough. Many electricity projects were behind schedule while the reserves and production of coal, crude oil and gas were decreasing year over year.

The growing demand for energy import was a problem in the energy industry development of Viet Nam because of the increasing reliance on energy from other economies, Hien said.

The energy transition was happening globally and in Viet Nam, Hien said. However, to meet the energy demand for socio-economic development, it was pressing to raise mechanisms and policies to create breakthroughs in energy industry development.

In addition, stronger measures would be taken to reduce greenhouse gas emissions to achieve net zero by 2050, he said.

In the service sectors, digital transformation and green transition also needed to be promoted.

Viet Nam witnessed the rapid development of e-commerce, cashless payment with the expansion of payment platforms and new payment methods, which were changing the habits of residents. It also attracted the special attention of credit institutions and big tech companies. Tourism was smarter and greener with attention to the protection of the environment and cultural heritage.

However, Deputy Head of the Party Central Committee’s Economic Commission Nguyen Duy Hung said that the results were just the first steps and there was a largely untapped potential in the digital transformation and green transition of the services sector.

Deputy Governor of the State Bank of Viet Nam Pham Tien Dung said that currently, about 72-73 per cent of adults have banking accounts.

He said there could not be a perfect public service if people did not have bank accounts and still used a lot of cash.

Therefore, what should be done was to increase the percentage of people with bank accounts, especially the disadvantaged, Dung said.

Viet Nam News