- Your Consultant
- Green Growth
|Nguyen Hoa Cuong, deputy director at the Central Institute for Economic Management|
The Central Institute for Economic Management (CIEM) is in charge of monitoring and evaluating the implementation of the National Strategy for Industry 4.0 through 2030. What has been achieved in the past year?
After one year of carrying out the prime minister’s Decision No.2289/QD-TTg dated December 31, 2020, on promulgating the strategy, ministries, agencies, and localities have researched and detailed the strategy, integrating it into annual socioeconomic development plans, projects, and more. They have proactively issued action plans to implement Decision 2289, with some localities piloting digital transformation at district and commune levels.
Objectives and tasks of the strategy have been integrated into the goals of socioeconomic development related to economic recovery, environmental protection, national defence, and security assurance.
Numerous legal documents have also been amended and issued to perfect the mechanism and promote the application of Industrial 4.0, such as adopting Decree No.80/2021/ND-CP detailing and guiding the implementation of some articles of the Law on Supporting Small- and Medium-Sized Enterprises (SME).
Ministries and agencies are also considering legal documents to support SMEs, startups, and innovation businesses to join industry clusters and value chains. The Ministry of Planning and Investment is building some incentives for eco-industrial parks, eco-enterprises, and innovative startups in the Law on Investment. Additionally, the laws on telecoms, intellectual property, and insurance businesses will be considered for amendments. Central and local agencies have been deploying solutions to apply IT in conferences and seminars; as well as managing online documents.
The economic restructuring plan in 2021-2025 and socioeconomic development plan in 2022 have been adopted. How do you assess the role of the digital economy in future development and for the recovery after the pandemic?
The contents of digital economy development have been mentioned in many congress documents, reports, and long-term strategic plans in recent years. Resolution No.31/2021/QH15 from last November set a target that the digital economy will contribute 20 per cent of GDP by 2025; and the proportion of the digital economy in each industry or field will reach at least 10 per cent, and sets the task of concentrating resources to develop digital economic infrastructure.
Meanwhile, Resolution No.32/2021/QH15 on 2022 socioeconomic development highlights accelerating economic restructuring in association with renovating the growth model, enhancing productivity, quality, efficiency, and competitiveness of the economy to create a foundation for the development of the digital economy.
They confirm the important role of the digital economy in economic development. In the last half of 2020, global e-commerce grew as fast as that of the five years before the pandemic. Particularly, global e-commerce growth in 2021 was equivalent to that in the previous five years, in addition to the boom of social media and online services.
Digital economy development has a proportional relationship with economic growth. The digital economy is considered a new driving force in economic development because it opens up new areas, upgrades old ones, or removes obsolete ones, as well as creates new jobs, helping the economy operate more efficiently thanks to the optimisation of both production and distribution.
The role of the digital economy has been recognised by governments over the world. According to the World Bank in 2016, the digital economy made up 6 per cent of the total GDP of OECD countries, 10 per cent of the UK's GDP, and 30.3 per cent of China’s GDP.
According to the Southeast Asian Digital Economy 2019 report published by Google, Temasek and Bain, Vietnam’s digital economy that year was worth $12 billion, contributing 5 per cent of the country’s GDP, which was four times higher than the value in 2015, and is expected to reach $43 billion by 2025, reflecting the increasing role of the digital economy in the country’s economic development.
In the past two years, however, Vietnam’s economy has been affected on a large scale. Regional and global economies are still unstable and Industry 4.0 and the digital economy are rising, opening up opportunities for post-pandemic economic recovery and breakthroughs for developing countries, including Vietnam. The digital economy, with new business models like e-commerce, the sharing economy, increasing labour productivity, and promoting innovation, are expected to create new business opportunities, new markets, and contribute to economic recovery.
The pandemic impacts are also a great opportunity and create pressure for many economic sectors to completely restructure, operating on the basis of science and technology, more effectively applying the utilities of the comprehensive digital transformation process, maximising productivity, and expanding market opportunities.
After visiting many developed countries and leading corporates, can you see some lessons that Vietnam could learn and apply to push socioeconomic development?
Developed countries have their own challenges, such as natural disasters, burdens in infrastructural development, and serious financial crises. South Korea used to be one of the poorest countries of the world with just $64 of GDP per capita after the war in the 1950s, but is now among the top ten leading economies over the world.
Meanwhile, numerous leading corporations have risen up after being based on micro, small, or household companies for a long time like Apple, Amazon, Walt Disney, Microsoft, and Google. To achieve those successes, the development of these countries and corporations relies on comparative advantages.
The start can be based on resources, and growth can be based on trade and investment, along with the support of foreign investment. However, breakthrough growth needs technology and the direction of the government to bring out the best in the intelligence and creativity of the private sector. In the current context, Industry 4.0 can contribute to finding new ways to deal with major challenges.
In the current context, Industrial 4.0 can contribute to finding new ways to deal with major challenges at home and abroad. Vietnam should actively participate in Industrial 4.0, enhance the awareness of authorities at all levels, and create favourable conditions for businesses, especially SMEs, startups, and innovative individuals. With that, we can research and apply the latest technologies to shorten the development gap as compared to advanced countries, save resources, and also improve the country’s labour productivity.
How can we mobilise resources for these plans and targets?
The National Assembly and government have built and adopted numerous important policies related to economic recovery and development, including fiscal and monetary ones. They reflect their strong determination to mobilise huge resources to reach the targets and plans set forth.
Additionally, we should raise the autonomy of state-owned enterprises to utilise funds for technology and science development, further facilitating the private sector to innovate, startups, and connect each other, towards sustainable development.
Moreover, the development of the digital economy in Vietnam is also expected to soar sharply in the time coming. Therefore, we should consider mobilising more resources from all sectors, in combination with promoting digital economy, innovation, and technology-science application.