Innovation startups eager for further supporting policies

How has Vietnam’s innovation startup ecosystem developed in recent times?

Pham Hong Quat, director general of the National Agency for Technology Entrepreneurship and Commercialisation Development under the Ministry of Science and Technology

The development of Vietnam’s national innovation ecosystem is highly appreciated by international organisations through their assessment of the innovation index and innovation ecosystem capacity index. All have seen improvements in recent times.

Supporting organisations for the national innovation ecosystem, both in the public and private sectors and in localities, has strongly increased in number and innovation capacity.

The efficiency of developing new products, and new business models, as well as calling for domestic and foreign investment has been improved in both number, scale and quality.

A series of tech-fest events at national-and international level have had wide spillover effects, contributing to encouraging young people to develop new tech-backed business models.

What is the growth potential of the country’s innovation startup ecosystem in 2024 and beyond?

Vietnam is facing challenges and huge opportunities in global integration and digital transformation, green growth, circular economy, and sustainable development. These are the priorities of international organisations when they work with Vietnam.

We are working with international organisations such as the Asian Development Bank and the United Nations Development Programme to organise many forums to support the local innovation community in approaching investment funds and supporting programmes. They can bring outstanding stories of Vietnam to the globe, and bring international stories to Vietnam.

High growth potential is forecast in food tech, health-tech, logistics, green growth, and carbon credit. They are expected to provide opportunities for Vietnamese young people to develop in the international arena.

Administrative procedures have not yet met the requirements of businesses. What are the priorities in the sector’s administrative reform and legal framework to help innovation startups attract venture capital funding?

To support the development of the national innovation ecosystem, the Ministry of Science and Technology (MoST) has been paying attention to administrative reform.

The ministry proposes the government to build a decree on innovation and innovation startups as a step to complete the legal framework with basic concepts about subjects in the innovation ecosystem, such as what an innovation startup is, what supporting organisations are, and what angel investors are.

These concepts are not available in existing documents. We expect that the decree will be soon issued to promote the involvement of subjects in the ecosystem.

Venture capital funds are often seeking for innovation startups and businesses when they already have initial market and capacity to grow their business scale and market. Therefore, creating an initial market for new products of innovation startups and businesses is critical.

To this end, the MoST has proposed the Ministry of Planning and Investment to include innovation startups and businesses in the list of prioritised units enjoying incentives in a decree guiding the Law on Public Procurement about selecting bidders. If approved by the government, this is an important step, creating new advantages for public procurement of innovation products.

We also encourage domestic and international powerful groups to pilot new products of innovation startups and businesses. This is considered an initial market for investors to find sustainable innovation business models in Vietnam which have competitive edge, thus attracting more venture capital funds for the development of the local innovation startup ecosystem in the future.

Hanoi – attractive city for startup and innovation Hanoi has been honoured for its attractiveness in startup and innovation under the Vietnam Smart City Award 2023 programme series.

Policy ecosystem the answer for cutting-edge startups While Vietnam’s environment for the development of the innovation startup ecosystem is becoming more favourable, full legal and policy corridors are in need to help them take off.