Digital economy-driven new growth orbit

Prof. Dr. Tran Tho Dat - Chairman of the Scientific and Training Council of the National University of Economics and a member of the Economic Advisory Council to the Prime Minister

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Digital economic development based on digital technology and data is naturally permeating the economy and business production processes. The Vietnamese economy is playing an increasingly leading role in terms of growth in order to expand quicker, more sustainably, and more resiliently to the challenges of an increasingly uncertain world, said Prof. Dr. Tran Tho Dat - Chairman of the Scientific and Training Council of the National University of Economics and a member of the Economic Advisory Council to the Prime Minister, in an exclusive interview with our reporter.

Sir, what is the potential force for the digital economy to become the primary economic driver in circumstances where traditional growth velocity is reaching its limit   ?

The world has been confronted with the task of achieving rapid and sustainable growth. Traditional methods of growth based on fixed capital, people, and natural resources have reached a tipping point. The spread impact of foreign investment, as well as the migration of workers across sectors, may not have the same effect on productivity growth. The current state of environmental deterioration calls the traditional model of growth into question. At this time, the 4.0 industrial revolution, in conjunction with the integration of digitalization and smart data networking, has helped to solve this difficulty.

The present context is viewed as a "golden time" for Vietnam to quickly seize the opportunities presented by digital transformation. The digital economy contributes to the development of surplus land and the optimization of new resources that generate higher labor productivity, which contributes to a change in national rankings, putting the economy on a path to breakthrough growth. For the first time, humans have brought new means of producing natural resources through data, resulting in the creation of a shared economy, a platform economy, and an internet economy that uses the digital world as a fundamental working space. According to the majority of digital economics research, digital economic development is environmentally friendly since it is a conventional fuel-free industry.

- What do you believe about the digital economy's growth potential in 2024 and the years to come?

The elements that comprise Vietnam's digital economy have various growth potentials. Statistics show that the core digital economy (information and communications technology) has reached its global equivalent, so there isn't much room for growth left. The rest—the digital platform economy and the digital sector economy—are now much lower than the global average. So these are the two remaining sectors with significant growth potential.

In the digital platform economy, the objectives of the Party and the Government are clear: create Vietnam's digital platform to shape digital economic growth. There is a large excess of growth for technological applications in several industries. The use of technology in sectors of the Vietnamese economy such as banking, education, health, agriculture, manufacturing, logistics, etc. will not only result in a shift in techniques and new development spaces but will also result in a significant increase in labor productivity. Create a new growth orbit in the future on that basis.

>> Financial sustainability and digital economy: New drivers for economic growth

The chances for the economy and businesses to break up are huge. However, in a difficult time like this, there are many challenges, sir.

Digital economic development is more than simply technical mathematics. Technology is crucial, but the most significant factor is institutional. Because the rise of the digital economy is accompanied by inventive ideas and new content, regulations must be made available. The government has a unique role in developing policies for digital economic development, i.e. creating fresh paths for new manufacturing processes.

It is vital to promote digital platforms in the digital economy, although there weren't many at the time. The government should address this issue with companies and invest appropriately in the Digital Platform Development Strategy in the future. Furthermore, developing digital human resources and establishing creative institutions in the digital economy are key considerations. In particular, there is a need to promote knowledge about the growth of the digital economy and digital transformation in order to be best equipped for the adaptability of firms, particularly SMEs and microenterprises. Businesses, on the other hand, must actively grasp chances, optimize their business models, develop fresh skills, and improve their managerial skills in line with the new business production model.

- Thank you!