During the Vietnam Economic Forum held in Hanoi early this year, Prime Minister Nguyen Xuan Phuc presented a key message - that the digital economy would be a new driving force for Vietnam to achieve its goal of rapid and sustainable growth. “Vietnam’s internet economy is booming,” he said. “It is forecast that the internet economy will reach a value of $33 billion by 2025.”

   The digital economy, with its new business models and methods, is creating opportunities for organizations and enterprises. New technologies will enable better connectivity across supply chains, reducing logistics and business costs.

   A recent Google and Temasek report noted that Vietnam’s internet economy grew at an impressive 35 per cent in the 2015-2018 period to reach $9 billion, or 4 per cent of GDP; the highest among ASEAN countries. E-commerce transactions nearly doubled in 2018 compared to 2017.

   Vietnam is currently witnessing digital transformation occurring across all sectors, from trade and payments to healthcare, education, transport and tourism, at an impressive pace. There can be no doubt that developing the digital economy will create opportunities for all. As such, Vietnamese businesses can tap into opportunities brought about by the digital economy and can enhance their business performance, expand market share, and even march into new market segments. Moreover, the digital economy helps small and medium-sized enterprises (SMEs) play a larger role in economic growth. 

   Our Cover Story this month reports on how Vietnam’s business community is working towards catching up with and staying abreast of the development of the country’s digital economy. We report on how the economy has changed since Vietnam developed information communications and technology (ICT) in 1993. 

   Besides the opportunities, the digital economy also presents significant challenges to Vietnamese enterprises, so they need to make further investments in new technologies, learn from new business models, and conduct thorough research to understand their customers’ needs in order to improve the quality of their products and services. 

   In order to boost the digital economy, the Vietnamese Government has been creating a legal framework over recent years. Its policies are also expected to promote the development of a digital economy, which will be a driving force for the local business community.