Hanoi (VNA)ꦐ - Vietnam’s digital transformation is reshaping the country’s socio-economic development at an impressive pace. From boosting productivity and revenue growth to transforming public services, the digital revolution is offering enormous opportunities, but not without its share of growing pains.

Digital transformation goes far beyond simply introducing new technologies. It represents a sweeping change in how organisations operate - be they government bodies, businesses, or individuals. At its core, it reimagines processes, mindsets, business models, and how services are delivered. Unlike traditional IT upgrades, digital transformation is strategic. It involves rethinking how organisations function at every level, leveraging tools like artificial intelligence (AI), big data, and the Internet of Things (IoT) to create value and improve user experiences. Vietnam is making bold moves to embrace digitalisation. A major milestone was reached on December 22, 2024, when Party General Secretary To Lam signed Resolution No. 57-NQ/TW, marking a significant step to accelerate innovation, science, and digital transformation nationwide. From health care and education to finance and public services, Government agencies and private enterprises are implementing digital strategies to modernise operations and improve outcomes. But experts warn that threats to progress like infrastructure gaps, workforce shortages, and cybersecurity could slow momentum. Addressing these obstacles requires coordinated action. Stronger collaboration across government, industry, and society is essential to build a robust and sustainable digital future.

Defining opportunities, challenges

Globally, digital transformation is no longer optional, it’s a necessity. Vietnam is rapidly catching up, leveraging its strengths to make significant progress in key sectors. Vietnam’s digital economy is booming. According to the e-Conomy SEA 2024 report by Google, Temasek, and Bain & Company, the country’s digital economy reached an estimated value of 36 billion USD in 2024, marking a 16% year-on-year increase. E-commerce alone accounted for 22 billion USD, up 18% from the previous year. As of February, Vietnam had 79.8 million internet users, roughly 78.8% of the population (which stands at 101 million). The country aims to expand the digital economy to account for 30% of GDP by 2030, with labour productivity growing at a minimum of 8% annually. Vietnam is also targeting a spot among the world’s top 30 nations in IT competitiveness, innovation, and cybersecurity. According to experts, digital transformation presents unprecedented opportunities. A digital government will increase transparency, reduce corruption, and improve efficiency. Meanwhile, a digital economy will promote innovation, enhance productivity, and drive economic growth. This is key for escaping the middle-income trap, and a digital society will ensure equitable access to education, services, and knowledge, helping to close development gaps and reduce inequality. Vietnam’s 2020 National Digital Transformation Programme set clear objectives -building a digital government, economy, and society while developing globally competitive Vietnamese tech enterprises. The Politburo’s Resolution No. 57-NQ/TW, issued on April 10, 2024, reinforced this strategy, positioning digital transformation and innovation as core drivers of sustainable national development. The Party chief underlined that science, technology, innovation, and digital transformation are not optional, they are the only path to national development and improving quality of life. Platforms like the National Public Service Portal are revolutionising how citizens interact with the state, offering services such as business licensing, tax filing, and vehicle registration online, cutting bureaucracy and saving time. Electronic health records and telemedicine are making healthcare more accessible and efficient, especially in remote areas. Digital learning platforms and online management systems have enabled continuity in education and improved teaching quality, especially during disruptions. Digital banking is booming. Services like MoMo and ZaloPay have transformed the way individuals and businesses handle payments and transfers, supporting Vietnam’s broader shift towards a cashless economy. Online shopping platforms are not just reshaping consumer habits, but fuelling economic growth and boosting digital GDP contributions. Vietnamese enterprises have become increasingly proactive in their digital strategies. According to Phung Manh Truong, Deputy Director of the Vietnam Standards and Quality Institute, businesses are now heavily investing in digital systems, including quality management software and enterprise tech solutions. To support small and medium-sized enterprises (SMEs), the Ministry of Information and Communications (now merged with the Ministry of Science and Technology) launched the SMEdx programme in 2021. By October last year, more than 1.28 million businesses engaged with the programme, with over 400,000 SMEs actively using supported digital platforms. Despite impressive gains, the journey is far from smooth. Many businesses still view digital transformation as a tech upgrade rather than a strategic necessity, limiting its true potential. Digital infrastructure remains patchy, particularly in rural and mountainous areas. High investment costs and the need for secure, reliable systems present serious challenges. A lack of skilled professionals in IT, cybersecurity, and digital strategy continues to constrain progress. While tech training is increasing, demand still outstrips supply. As digital footprints grow, so do threats. Data protection and cyber resilience must become national priorities. According to Le Nguyen Truong Giang, Director of the Institute for Digital Transformation Strategy, inconsistent leadership and siloed implementation are undermining progress. Digital transformation needs consensus, he said, adding that when responsibility is isolated to a few individuals, the result is often superficial compliance, not meaningful change. Giang also highlighted the importance of open platforms and data sharing. While Vietnam officially supports open data and digital collaboration, in practice, many systems remain closed and fragmented. To accelerate transformation, it is necessary to open mechanisms, not rigid structures or metrics controlled by a handful of institutions, he stressed. Vietnam’s digital transformation isn’t just a trend, it’s a defining force shaping the country’s future. But to fully realise its potential, Vietnam must address infrastructure and talent gaps, strengthen cybersecurity, and build an inclusive ecosystem driven by open collaboration and decisive leadership./.