Opportunity to Realize Aspirations for Prosperity

2:08:32 PM | 8/10/2019

In September, the Politburo issued a resolution “Some guidelines and policies on active participation in the Fourth Industrial Revolution”, showing the resolve of the Party, the State and the Government of Vietnam in carrying out Industry 4.0, where the business community is an action group, a leading and pioneering force that is crucial to the success of this revolution.

Three Industry 4.0 phases and ambitious “Make in Vietnam”

Speaking at the Digital Cambodia Forum 2019 held in March, Minister of Information and Communications Nguyen Manh Hung said Vietnam's Industry 4.0 Strategy will consist of three phases: (1) Accelerating Industry 4.0 application in all sectors to increase operational efficiency and productivity and create new growth opportunities; (2) Focusing on researching and mastering technology to develop 4.0 products through the Make in Vietnam 4.0 Program; and (3), using Industry 4.0 as a domestic and global competitive advantage to realize Vietnam's goals for national industrialization and modernization.

Not waiting until the National Strategy on Fourth Industrial Revolution is adopted, some industries have been actively promoting Industry 4.0 application. The phrase “Make in Vietnam” was first mentioned by the Ministry of Information and Communications in the Vietnam - Myanmar Information and Communications Technology Forum themed “Digital transformation in Government” held at the end of 2018 in Myanmar when it referred to products and technological solutions introduced and represented at the forum by Vietnamese ICT enterprises such as Viettel, VNPT, MobiFone, FPT and BKAV. “Make in Vietnam” is the message for the new-phase development of Vietnam's ICT industry in the new period, according to the leader of the Ministry of Information and Communications: Vietnamese enterprises and people are active and creative to design and innovate products in Vietnam. “Make in Vietnam” 4.0 Program aimed at developing IoTs (Internet of Things) is a key upcoming approach of the Ministry of Information and Communications to disrupt and globalize Vietnam’s ICT industry marked “Make in Vietnam”, and grow the technology community.

Grasping opportunity

In October, the Central Economic Commission and some related ministries jointly organized Industry 4.0 Summit 2019, including five symposiums, one exhibition on modern technology and one business matching event. The symposiums delved into five main topics: Smart bank; smart city, smart production, smart energy and digital economy. The Politburo's Resolution on Industry 4.0 was announced on this occasion.

Currently, the National Strategy on the Fourth Industrial Revolution to 2030, drafted by the Ministry of Planning and Investment, is seeking expert and public opinions for completion.

To actively seize Industry 4.0 opportunities and trends in the 2021-2030 period, the strategy states:

Applying Industry 4.0 to e-government construction towards a digital government to adopt smarter, faster, more transparent and more effective administration; reduce administrative expenses, shorten policy research and enaction duration; and improve the effectiveness of policy monitoring to produce greater satisfaction to people and businesses.

Applying Industry 4.0 to upgrade and convert current production systems to optimize resource allocation, develop production, do faster, smarter and more efficient business, cut costs, seek more domestic and international markets, manage better supply chains, develop new products and services more quickly, and improve business productivity in particular and the entire economy in general.

Investing, promoting and improving the efficiency of scientific and technological activities; researching, developing and mastering typical applications of Industry 4.0 and beyond, taking the lead in some cutting-edge technologies, ensuring long-term national competitiveness.

The above technological application and development trends are guaranteed to be built on three basic elements: Market economy institutions are friendly to the economic model based on science, technology and innovations to facilitate businesses to invest in scientific and technological research and application, create new products and services, expand business scale and reach out to regional and world markets; Digital infrastructure system enables application of Industry 4.0 on a large scale and scope, including wired and wireless high-speed internet connectivity, supports building and sharing databases, and facilitates businesses and people to gain benefits from Industry 4.0; and Human resources are enough and qualified to enable technological transformation and upgrading, and research and develop new technologies, products and services in Industry 4.0 era.

Growth motivations

Ambitious strategic goals will be a new growth engine for the economy in general and enterprises in particular. On the development of economic institutions, the strategy sets the goals: Building a modern, full market economy institution system that is good for innovations and new business models of Industry 4.0 era; and achieving at least No. 60 by 2025 and at least No. 30 by 2030 on the Institutions Index, a sub-index in the Global Competitiveness Index 4.0 of the World Economic Forum (WEF). By 2022, the system of legal documents on state management of digital environment will be completed.

With respect to connectivity infrastructure and database investment and development, the goals of the strategy are: Achieving at least No. 60 by 2025 and No. 30 by 2030 on the Networked Readiness Index (NRI), a sub-index of the WEF Global Competitiveness Index 4.0, and the ICT Development Index (IDI) of the United Nations International Telecommunication Union (ITU). Accordingly, by 2025, Gigabyte fiber optic internet infrastructure and high-speed mobile broadband internet (4G and 5G) will cover all communes and all administrative agencies and public utilities. By 2030, the rate of internet users will reach 100%. In 2022, Vietnam will have completed building six national databases and introduce regulations on collection, management, sharing and usage of economic data and state management purposes. By 2030, the construction of the national database system will have been completed.

On human resources development, according to the strategy, human resources will meet 90% of enterprises’ needs for workers with necessary skills for new jobs, especially information technology skills, by 2025 and 100% of their demands by 2030. Vietnam will reach at least No. 60 by 2025 and No. 30 by 2030 on the Skills Index, a sub-index of the WEF Global Competitiveness Index 4.0.

On public governance transformation, Vietnam will attain at least No. 60 by 2025 and No. 30 by 2030 on the United Nations E-Government Development Index (EGDI). It will achieve at least No. 50 by 2025 and No. 25 by 2030 on the United Nations E-Government Participation Index. By 2025, 100% of administrative agencies will provide Level 4 online public services.

On corporate technology transformation, application and innovations, the rate of enterprises applying at least one of Industry 4.0 technologies will reach at least 20% by 2025 and 40% by 2030. These rates in prioritized sectors will be at least 30% in 2025 and 50% in 2030. The country will obtain at least No. 50 in 2025 and No. 30 in 2030 on the Innovation Index of the WEF Global Competitiveness Index 4.0 and achieve at least No. 40 in 2025 and at least No. 30 in 2030 on the Global Innovation Index. At least 5 technology companies will make individual revenue of US$1 billion by 2025 and at least 10 companies will make this by 2030.

On technological promotion, research and development, Vietnam targets to master some 4.0 technologies: Total social investment for R&D shall reach at least 1.5% of the country’s GDP by 2025 and 2% of GDP by 2030. By 2030, Vietnam will be among top 30 holders of patents in priority technology fields. At least five companies by 2025 and 10 companies by 2030 will export Industry 4.0 or beyond products and services to G7 countries, such as 5G, internet of things, artificial intelligence, blockchain and data analysis.

With these goals, Industry 4.0 is truly an opportunity for Vietnam to realize its aspirations for building a prosperous country as said by Prime Minister Nguyen Xuan Phuc.

Nguyen Thanh