Vietnam holds huge potential to develop digital economy

Digitalisation is present in almost all fields in Vietnam, replacing traditional business models, from business registration and electronic invoicing, to online retail, property and banking.

More start-up companies are being established in Vietnam and many have achieved impressive business results in e-commerce, QR code payment, electronic wallet and e-banking solutions.

A report of the Vietnam E-Commerce Association showed that 2017 was a booming year of the Vietnamese e-commerce sector when its revenue exceeded 2 billion USD, a twofold increase over the previous year. The figure is forecast to hit 5 billion USD by 2020.

However, e-commerce accounted for only 3.6 percent of total retail sales, lower than the average rate of 14.5 percent in the Asia-Pacific region.

The Vietnam Chamber of Commerce and Industry said that along with opportunities, the digital economy also creates a lot of challenges for Vietnamese enterprises. 

The first challenge is the strong presence of foreign enterprises in many industries of the Vietnamese economy. The influence of foreign technology firms such as Facebook, Google and Microsoft on Vietnamese society is enormous. 

Meanwhile, the high costs of IT equipment and poor logistics services compared with regional countries are also preventing many Vietnamese enterprises from expanding into the digital economy.

In addition, most Vietnamese consumers still lack trust in online shopping.

Deputy Minister of Science and Tecgnology Bui The Duy advised businesses to consider their business strategy and capacity when they want to digitise their operation.

Digital transformation does not mean buying software and hardware but concerns how to change the business model and adapt to technological transformation. Therefore, each company should have their own way of transformation that best suits their conditions, he added.