New space vital for digital overhaul

June 06, 2022 | 10:00
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In order to develop, it is necessary to have new development space – and digital transformation creates this. In China in 2020, the digital economy made up nearly 40 per cent of GDP, while the threshold in Vietnam in 2021 was 11-12 per cent. This means there is big development space to grow, and Vietnam targets that the digital economy will account for 20 per cent of GDP by 2025, or 20-25 per cent growth annually.
New space vital for digital overhaul
Nguyen Manh Hung-Minister of Information and Communications

Digital transformation creates new resources for development – this is data. Some call data the new oil. Some call it an input factor which is similar to land or capital. Digital data is considered a new land resource. But it is different from natural land resources because the more data we have, the more of this new land resource we have. The application of digital technologies will create value and, in the long history of existence, human beings only tap into resources but have never created them.

Digital economic development needs related infrastructure. This can include broadband telecommunications infrastructure which has wide coverage; with each resident having a smartphone and each household enjoying fibre-optic internet. This also includes cloud computing infrastructure, helping with data storage and processing of Vietnamese data here. There is also the infrastructure that provides technology as a service.

Over past years, Vietnamese digital technology enterprises have developed many platforms to solve a number of issues related to the economy, culture, society, and the environment. In the meantime, cities and provinces have tended to choose appropriate digital platforms to solve their problems. Many platforms are being used, and some have to develop further to adapt to new demands, and they are all Vietnamese-made.

Mankind’s development in this century will mainly be based on innovations, and Vietnam is not an exception. To keep innovations fast, economical, and applicable for all, innovations should be made in the digital environment. Digital transformation creates a digital version of the real world, or transforms the real world into the digital world. For the first time in development history, human beings are creating a real-virtual relationship and can live in both at the same time – and they support each other.

Design, creation, and testing can be done very quickly at a very low cost in the digital world before being produced in the real world. Moreover, analysing data in this new world can make recommendations for the real world, thus enabling the real world to run in a more optimal and efficient manner.

Digital transformation is creating three big trends which contribute to sustainable development. They are de-intermediation, decentralisation, and dematerialisation. De-intermediation can be done through the platform economy. An example of this is an e-commerce platform. Decentralisation can be done through the sharing economy, with ride-hailing technology being an example, or AirBnB services when they is dispersed among households.

Dematerialisation is the virtualisation of physical products and services such as e-books and digital music, simulating the physical world with virtual reality, meaning an increase in the use of non-physical products and less use of physical ones. These trends help our economy grow more efficiently and increase our competitiveness.

Digital transformation is the convergence of science and technology, knowledge economy, innovation, and Industry 4.0 because it is based almost entirely on science and technology, and creates a digital economy. Moreover, current innovations are mainly in the digital space. The technologies now gather all these strengths of the era, thus creating breakthrough development. Never before has mankind had such a large convergence, and we now have a great opportunity to break out.

Vietnam now has advantages for digital transformation acceleration. The biggest advantage of the one-party system is the ability to mobilise and focus the whole country’s effort on great things like national digital transformation, and very few countries have such an advantage.

In 2019, the Politburo issued Resolution No.52-NQ/TW on actively participating in the Fourth Industrial Revolution. In 2020, the prime minister promulgated the National Digital Transformation Programme. And last year, the Resolution of the 13th Party Congress oriented to accelerate this. In mid-2021, the prime minister also issued the e-government strategy for creating a digital government.

Continuing this forward momentum, this year the prime minister promulgated the Digital Economy and Digital Society Strategy. Almost all ministries, agencies, and localities have issued resolutions, strategies, and programmes, and these are the foundation for the country’s success in the next steps.

By Nguyen Manh Hung

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