Much to ponder for a digital-led economy

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The pandemic and Industry 4.0 have opened up new directions for Vietnam’s economy, while digital transformation could be the key to unlocking and recovering the economy.

Much to ponder for a digital-led economy

Speaking at last week’s Industry 4.0 Summit on promoting industrialisation in a digital age, the World Bank’s Mary Hallward-Driemeier talked about shoe giant Adidas and why it decided to move factories from Germany to Vietnam and China.

Hallward-Driemeier, who is senior economic advisor of Finance, Competitiveness, and Innovation Global Practices, said that the move from Adidas could be an opening for developing economies like Vietnam to improve their value by enhancing labour skills, linkage capacity, and digital transformation across businesses.

“Vietnam needs a framework for competition and creation policies to promote new business models, digital capabilities, flexibility, adaptability, and data connectivity. At this time, low wages are no longer competitive,” she recommended.

At present, Industry 4.0 is accelerating but not evenly, with tensions still causing trade shifts. The proportion of investment in research and development (R&D) and green development is also soaring across the world. “This is therefore the ideal time for the drastic implementation of Vietnam’s digital transformation, which is expected to open up a huge opportunity,” urged Hallward-Driemeier.

Practices of other countries

In order to recover post-pandemic, every country will carve its own methods to apply digitalisation and innovation to adapt to the new situation. “Experts around the world believe that there will be a new world order after COVID-19, while we see that science and technology will make our future,” said Yong Hongtaek, South Korea’s Vice Minister of Science and ICT.

Hongtaek’s country has made several policies and spending huge budgets on scientists and startups. In 2021, South Korea has allocated a budget of around $180 million, doubling the expense in 2018 for innovative enterprises, innovation centres, and digital transformation plans of businesses. He also affirmed that the budget will continue to increase in the near future.

“In this context, the decision to implement digital transformation in a business is not only the decision on its development path but also the future of the economy. Similarly, if scientists and startups have enough resources to take risks and conduct R&D activities, and businesses have their own way to commercialise their products in the laboratory, the economy will not only recover but also develop well. So the government should build incentive policies to support these activities”, the South Korean minister recommended.

He also said that a month ago, South Korea issued the Data Framework Act, which stipulates the bases for data construction, establishment, exchange, and use. Despite still being quite abstract, this is the world’s first law on this issue, allowing businesses and users to have an enforcement mechanism, so promoting the growth of industries related to the data economy that South Korea is claiming to have switched to.

According to Spencer J. Cox, the governor of Utah of the United States, Silicon Slopes is the voice, hub, and heart of Utah’s startup and tech community, empowering the state’s tech startups to learn, connect, and help make entrepreneurship and opportunity accessible to all. “We will provide 600 acres of state-owned land that will foster innovation and technological advancement to support economic growth and enhance Utahn’s quality of life,” Cox explained.

Pioneering local enterprises

One of the subjects to implement undertakings and policies to restore and develop the economy and carry out industrialisation and modernisation is businesses. With the support of the government, many businesses have been proactively anticipating the trend of innovation based on science and technology as well as digital transformation to improve competitiveness and participate in global value chains.

Also talking at the third annual Industry 4.0 summit, Pham Tan Cong, chairman of the Vietnam Chamber of Commerce and Industry, said that it is necessary to help businesses restructure their workforce and change the way of doing business in a more digitalised environment. “All of these things will create new momentum for Vietnam’s businesses, and then, in the medium and long terms, we will contribute to creating a new economic restructure in Vietnam, contributing to the realisation of the goal of industrialisation and modernisation proposed by the 13th National Party Congress,” said Cong.

Le Dang Dung, chairman and CEO of Viettel, stressed the group’s pioneering role in the national innovation process, especially in digital transformation.

“To fulfil that role, we have created and produced important platforms in digital finance, content, and commerce. Viettel is also pioneering in R&D and mastering background and core technologies, creating world-class high-tech products,” said Dung. “Our main goal is to bring Vietnam to par with the world in digital transformation, as well as in R&D for the high-tech industry.”

Huynh Quang Liem, CEO of Vietnam Posts and Telecommunications Group, highlighted the role of digital transformation in economic recovery. “As an enterprise supporting businesses to transform to a digital environment, we understand and will provide specific policies to help them with a quick recovery, and more efficient production after the pandemic,” said Liem.

Nguyen Tam Tien, general director of Trung Nam Group, meanwhile said 4.0 includes two parts. “Firstly, all devices that people use later must be connected to the internet. Secondly, to reduce human tasks, software must always be applied. In industrial development, digitalisation will solve many issues and contribute to boosting work efficiency,” Tien said.

Source: VIR

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