Digital Economy: Open but must control risks

Trial production at the Training Center of Ho Chi Minh City High-Tech Park. Photo: Hoang Hung

Measuring the digital economy

According to the National Committee on Digital Transformation, 2024 is the year of digital economic development, with 4 pillars: information technology industry (IT); digitalization of economic sectors; digital governance; digital data. In 2024, the contribution rate of total digital economic components to GDP will reach about 19% and in 2025 it is expected to account for over 20% of GDP. In previous years, in the period 2020-2023, the General Statistics Office said that the digital economy accounted for 12.66% -16.5% of GDP. This rate in Vietnam is much lower than that of China and Singapore.

According to the latest data, China announced that the estimated proportion of the digital economy in GDP in 2019 and 2021 was about 30% and 40% respectively; the proportion of the digital economy in Singapore's GDP in 2022 was 17.3%.

According to Ms. Nguyen Thi Huong, Director General of the General Statistics Office, because there is no unified general guideline in the world on measuring the contribution of the digital economy to growth, the scope and method of measuring the digital economy in countries around the world are not uniform, leading to different results in calculating the contribution of the digital economy to GDP in countries. However, if in 2019, the digital economy only contributed about 5% to the Vietnamese economy, with 12 billion USD, then by 2023 the digital economy contributed up to 16.5% of GDP, achieving a growth rate of more than 19%/year, about 3 times higher than the GDP growth rate. With such great potential, in 2024, the breakthrough year in implementing the 5-year socio-economic development plan 2021-2025, the digital economy is expected to be one of the new growth drivers.

According to experts, the digital economy (including the core digital economy - input of the digital economy; application of the digital economy to other industries - output of the digital economy) has a ratio in the core digital economy sectors that is nearly one and a half times higher than the ratio of the digital economy applied to other industries. This explains why in the period 2020-2023, there were 10 localities with a higher proportion of added value of the digital economy in GRDP than the national average, in which Bac Ninh, Thai Nguyen, Bac Giang, Vinh Phuc provinces were in the top group; followed by Hai Phong, Hanoi, Ho Chi Minh City, Da Nang and Ha Nam. These are all localities that strongly attract foreign direct investment in core digital economy sectors - manufacturing of electronic products, computers and optical products...

In 2023, in the added value of the digital economy, core economic sectors account for 87%-96% of the total added value of the digital economy of the top 4 localities. Meanwhile, the core economy accounts for only 68% of the digital economic value of Hanoi and this rate of Ho Chi Minh City is only 66%.

Start with the right perception

According to the policy of proactively participating in the fourth industrial revolution, by 2030, the digital economy will account for about 30% of GDP. However, not all localities have strengths in developing the core digital economy. Moreover, the planning orientation of economic centers such as Hanoi, Ho Chi Minh City, and Da Nang is to focus on developing services, especially high value-added services such as finance, banking, insurance, tourism, etc., while other localities have more room to develop production activities. Therefore, the digital economic development model of localities may not be the same.

In some localities, digital economic activities mainly involve expanding the application of digital economy in areas of strength and in management and operation activities. In particular, the proportion of digital economy in agriculture, forestry and fishery is still very low, it is necessary to strongly transform from small-scale agricultural production to agricultural economy, urgently apply and expand the application of digital economy in this sector, while the proportion of digital economy in industry - construction is better because the core digital economy focuses mainly on these sectors.

It is noted that the proportion of digital economy in the service sector is currently the highest, but it is still the sector with the most room for diverse digital economy applications, especially for some sectors with low digital economy rates, such as veterinary medicine, social assistance, care, centralized nursing, pollution treatment, waste management, etc.

Product packaging line at Vietnam Livestock Industry Corporation (Vissan). Photo: Hoang Hung

The first and perhaps the biggest challenge when applying the digital economy in particular and developing the digital economy in general is the awareness of the digital economy, an important, new, difficult, and highly intellectual issue. For example, to create a breakthrough in this field, three pillars are needed: digital infrastructure, digital data warehouse, and "digital people". In particular, the requirement to have a complete, accessible, highly connected, and interconnected digital data warehouse can create certain risks in terms of IT, network security, etc.

Dr. Can Van Luc, Director of BIDV Training and Research Institute, emphasized that with the digital economy, the consistent viewpoint is “a balance between openness and risk control”. It is necessary to be open to create timely development, not miss opportunities, even pioneer in some fields, but it is also necessary to have effective solutions to prevent and handle all possible risks that may occur, negatively impacting all aspects of economic and social life.

“Artificial intelligence brings many great benefits, but it is no coincidence that Europe is urgently preparing a law on artificial intelligence and China is also researching to soon promulgate a similar law,” Dr. Can Van Luc emphasized.

Mr. Nguyen Manh Hung, Minister of Information and Communications: There must be a more creative way of doing things.

Digital transformation is a strategic choice, a path to bring Vietnam to strength and prosperity. After nearly 4 years, we have seen the path, seen the approach, acted strongly, and had initial results. Now is the time to act more strongly, more decisively, to create more practical and comprehensive results for the people. Other countries are also transforming digitally, if we are not more decisive, do not have more creative ways of doing things, do not continuously take the lead, we will be the country that follows, falls behind, and the dream of a strong Vietnam will continue to be a dream!

Mr. Truong Gia Binh, Chairman of FPT Corporation: Focusing human and financial resources on key technology fields

To exploit the potential of digital transformation - green transformation, creating dual development in both digital economy and green economy, Vietnam needs to pioneer the development of fields such as artificial intelligence, semiconductor chips, smart electric vehicles, green transformation. It is necessary to focus human resources and finance on these key technology fields.

Mr. Matthew Francois, senior digital expert at McKinsey & Company: Opportunity for Vietnam to enhance national competitive advantage

Digital economic sectors can bring many benefits to Vietnam. E-commerce transactions are increasing; healthcare, education, and finance are strongly supported and promoted by digital infrastructure. This is an opportunity for Vietnam to use digital transformation to enhance national competitive advantages; increase labor productivity, and create new growth space for the business community.

BAO VAN

Source: https://www.sggp.org.vn/kinh-te-so-coi-mo-nhung-phai-kiem-soat-duoc-rui-ro-post745098.html