Greener, faster, smarter digital plans

Tran Quoc Phuong-Deputy Minister of Planning and Investment

After some decades of rapid growth, Vietnam has been struggling with major challenges affecting its development such as the global economic downturn, which has slowed growth. The economy, based on cheap labour and natural resources, is not at a competitive advantage any more. There is also the risk of falling into the middle-income trap, and the ageing population to contend with.

These challenges require Vietnam to find new growth models and engines for the economy. In this context, Vietnam has actively approached opportunities from the Fourth Industrial Revolution and the rapid development of digital technologies.

The prime minister has approved the National Digital Transformation Programme, the National Strategy on the Fourth Industrial Revolution, and the E-government Development Strategy covering this decade and beyond. These efforts reaffirm the government’s determination to transform into a digital economy, which is an indispensable and objective requirement at a time when the whole world is witnessing rapid changes.

In the process of formulating strategies and master plans for socioeconomic development, the Ministry of Planning and Investment (MPI) cooperates with ministries, branches, and localities to integrate tasks and solutions for Industry 4.0 and digital transformation to promote innovation in growth models.

In order to support enterprises, since early 2021, the MPI has also proactively implemented the initiative to support businesses in digital transformation to 2025, to promote Vietnamese businesses to transform and adapt to the new context. The programme aims at transforming the awareness, vision, and strategy of enterprises; digitalising business activities, management, tech, and production processes; and supporting comprehensive digital transformation to create new products, services, and models for businesses.

This programme has provided a wealth of knowledge and experience, and foundational tools over the past two years to help businesses move in the right direction, save time and costs, and improve the competitiveness of enterprises.

In addition to the policy of promoting digital transformation towards a digital economy, the restructuring of the economy is associated with the renewal of the growth model in order to achieve economic prosperity, environmental sustainability, and social welfare. As Vietnam increasingly integrates into the global economy, businesses will have to be compliant with commitments on sustainable development and green growth that Vietnam has signed within various free trade agreements. This is a great pressure and challenge for Vietnamese businesses to be accepted by the market.

In addition, the National Strategy on Green Growth for this decade with a vision to 2050 highlights the view of increasing green growth with oriented investment in advanced technology, digital transformation, and smart and sustainable infrastructure. This will be an impetus for private investment to play an increasingly important role in the green economy.

The requirement for digital transformation and green growth is a major challenge for Vietnam and its businesses. Around the world, experts consider these as catalysts for many businesses to transform and adapt to green and sustainable models.

Examples include printing receipts – in 2019, it is anticipated that over 550 billion invoices were utilised in the US, of which only 10 per cent were electronic. This number will quadruple by 2030. This quantity of bills is mostly composed of planted wood. Using digital technology via the use of e-invoices reduces transportation costs and associated expenses, therefore lowering carbon emissions.

Thus, organisations must begin implementing digital transformation, including green transformation – particularly when companies adopt environmental, social, and governance standards or when customers want greener, more responsible goods. In order to build a sustainable business model that will provide value to the economy, organisations must prepare for an environmentally friendly transition.

Corporations have developed long-term strategic plans, a strong basis for applying digital transformation to their business models, and eco-friendly goods. Small- and medium-sized businesses are also not left behind. These firms are very dynamic. If they latch on to a trend, they will grow rapidly. They have successfully incorporated AI technology into manufacturing.

The benefit of being a latecomer is that we have access to more advanced tech. In addition to the obstacles associated with the law, enterprises must also contend with the fact that their size is still modest. To create digital and green technology, they need an ecosystem, such as the leadership of the government or of significant corporations.

On the flip side, the 5G concept is a little unconventional. We place a major emphasis on getting 5G up and running to deliver services to businesses. Thanks to its high speed and low latency, 5G will generate benefits for the expansion of manufacturing capabilities. Trials of 5G are also necessary to deliver tailored services in settings like an industrial park, factory, or seaport, all of which have various requirements in terms of data transfer rate, number of connected devices, and latency, among others.

Due to the pandemic, digitalisation efforts have been cranked up to speeds 10-20 times faster than in prior years. It pushed traditional business models to become more innovative and digitally led, as digital channels were the only option for communication and engagement during that period.

The driving force of the digitisation process is to satisfy customers’ ever-evolving demands, provide innovative user experiences, and add more meaningful value for them, which make their lives easier.

In 2019, I came to Vietnam with the intention of establishing the country’s first carbon-neutral bank, with the goal of serving young people who have not had access to traditional banking services. Compared to the conventional banking approach, our annual carbon footprint is under 0.3 tons, which is a negligible amount, and we plant trees every year to offset this impact.