Enterprises need a strong push to drive dual transformation

According to HSBC, 2025 will mark a turning point, with projections that the digital economy will account for 25% of GDP, while green credit will make up 10% of total outstanding loans. Notably, Viet Nam boasts unique advantages: a young workforce (70% of the labour force), nearly 80% internet penetration, and the second-fastest digital market growth rate in Southeast Asia.

Dual transformation gains ground, yet disparities remain

Recognising the importance of dual transformation, Garco 10 Corporation has replaced 90% of its coal-fired boilers with biomass alternatives and aims to reduce CO₂ emissions by 20,000 tonnes by 2025. The company now uses 30–50% recycled fibre in its products and plans to install solar panels across all factory rooftops. These efforts not only reduce costs but also help the firm meet stringent standards set by international partners.

Than Duc Viet, General Director of Garco 10 Corporation, affirmed that digitalisation and green transformation are no longer optional moves but a strategic pairing Viet Nam’s textile enterprises to enhance competitiveness, improve business performance, and generate new value.

“We have proactively invested early in clean technologies, energy-efficient processes, and modern wastewater treatment systems instead of awaiting regulatory mandates. This is not only a preparation for the future but a strategy to gain competitive advantage today,” he noted.

Echoing this view, Trinh Thi Lan, Director of Digital Transformation Consulting Services at Viettel Solutions, said that dual transformation helps businesses strengthen their competitive edge and move towards sustainable development. While digital transformation redefines business models and boosts operational efficiency, the green transition minimises environmental impact and aligns with global standards such as ESG, CSR, and NetZero targets.

“Enterprises that pursue dual transformation can achieve up to 2.5-fold growth compared to those adopting only one strategy,” Lan noted.

A survey by the Viet Nam Chamber of Commerce and Industry (VCCI) showed that in the wake of the COVID-19 pandemic, most Vietnamese businesses rapidly accelerated their adoption of digital technology. Many introduced internal management platforms, electronic payments, virtual conferencing, and e-commerce. The use of cloud computing in internal management has reached 60.6%.

As for green transformation, the use of renewable energy, clean production practices, and ESG standards has gained significant momentum, especially among export-oriented and foreign-invested enterprises. Sectors such as organic agriculture, green transport, and energy-efficient housing have also begun to show promising signs.

Notably, from 2024, the establishment of a carbon credit market in Viet Nam marks a major milestone, opening up new financial opportunities for businesses through the sale of reduced emissions. In addition, the introduction of greenhouse gas inventory requirements and emissions quotas from 2023 to 2026 has added pressure, but also spurred enterprises to accelerate their transition towards greener practices.

Much still to be done

While dual transformation presents significant opportunities for businesses, experts caution that “much still remains to be done”. At present, the green economy accounts for only around 4–4.5% of Viet Nam’s national economy, with over 95% still categorised as a “brown economy”.

Data from the Ministry of Natural Resources and Environment (now the Ministry of Agriculture and Environment) also show that the size of Viet Nam’s green economy stands at approximately 7 billion USD, equivalent to 2% of GDP, and is concentrated primarily in the energy and agriculture-forestry sectors. Other areas such as industry, transport, communications, waste management and construction remain underrepresented.

Meanwhile, Viet Nam has set itself an ambitious goal: achieving a 2 trillion USD economy by 2050 and fulfilling its Net Zero commitment, targets that hinge heavily on the effective implementation of dual transformation, both green and digital. The role of businesses is crucial in reaching these objectives.

Dr To Van Tuan from the Viet Nam Maritime University explains that digital transformation currently occurs mainly within large enterprises and foreign-invested companies, while small and medium-sized enterprises (SMEs) still face many constraints. In fact, fewer than 10% of businesses consider their digital transformation efforts successful; most are still in the pilot phase or have only partially implemented changes.

What is particularly striking is the widening gap between large enterprises and SMEs. While major corporations have proactively invested in advanced technologies such as AI, IoT, and Big Data, SMEs, accounting for 97% of all enterprises, continue to struggle due to limited capital, insufficient technical expertise, and a shortage of qualified personnel.

“As many as 92% of SMEs still lack a clear understanding of digital transformation, and 72% do not know where to begin. This reflects a significant gap that must be bridged through concrete policies and targeted support from the State and business support organisations,” he said.

In light of these realities, Dr Tuan proposed a series of practical measures to accelerate dual transformation in Viet Nam. First, the Government should implement financial support policies and tax incentives, particularly by strengthening green credit schemes and offering preferential loans to businesses investing in digital technology, renewable energy infrastructure and clean production lines. Secondly, there needs to be greater investment in education and human resource training, focusing on digital technology fields, environmental specialists and ESG (Environmental–Social–Governance) managers.

In parallel, innovation and the development of green industries should be encouraged, especially in AI, big data and IoT applications in manufacturing, while promoting circular business models that conserve resources and reduce emissions. Additionally, strengthening public–private partnerships and mobilising international funding are key. Finally, Dr Tuan recommended tightening environmental regulations and enforcing ESG standards more rigorously.

In summary, if implemented in a comprehensive and well-targeted manner, dual transformation is not merely a response to challenges but a significant opportunity for Vietnamese enterprises to strengthen their position in the global market.