Digital Economic Development Rate in Vietnam is Fastest Among Southeast Asian Countries

On April 24, Prime Minister Pham Minh Chinh, Chairman of the National Committee on Digital Transformation, chaired the 8th session of the Committee. The discussion focuses on the digital economy development rate.
April 27, 2024 | 20:58

In his opening speech, Prime Minister (PM) Pham Minh Chinh stressed that 2024 is the year of breakthrough in implementing the 5-year socio-economic development plan 2021 - 2025.

(Photo: VGP)
Prime Minister Pham Minh Chinh, Chairman of the National Committee on Digital Transformation, chaired the 8th session of the Committee on April 24 (Photo: VGP).

The focused task is to promote growth and economic restructuring, effectively utilize traditional growth drivers and promote new growth drivers, including the development of a green economy circular economy, and digital economy. It is also to promote national digital transformation, and develop digital government, digital economy, digital society, and digital citizens. There are three strategic breakthroughs: Institutions, including institutions related to digital transformation; human resources, especially high-quality human resources, with the focus being human resources for digital transformation; and infrastructure, including digital infrastructure.

Also, one of the focused tasks is to improve the effectiveness and efficiency of State budget, revenue, and revenue management, especially promoting digital transformation in these areas (such as food and business beverage services, restaurants, e-commerce, doing business on cross-border platforms) and cashless payments.

Implement fully, promptly, and improve the effectiveness of policies for people with meritorious services, social assistance, and social security assurance, including payment of benefits to non-cash policy beneficiaries.

PM Pham Minh Chinh emphasizes that digital transformation is a breakthrough, a key task, an objective requirement, a strategic choice, and a top priority in implementing socio-economic development goals. For people and businesses, it is to reduce administrative procedures, reduce complications, reduce compliance costs, and travel costs. The more strongly digitized, such as promoting cashless payments, the more openness and transparency will be, and the more effective the prevention of corruption and negativity.

The Government and the Prime Minister always pay attention to and request all levels, branches, localities, and the Committee to regularly and continuously monitor, evaluate, urge, and closely direct the work of national digital transformation to ensure its effectiveness and substance. Chinh said that the 2024 Work Plan has determined the focus of national digital transformation with the theme "Digital economic development with 4 pillars of information technology industry, digitalization of economic sectors, digital governance, digital data - An important driving force for rapid and sustainable society -economic development".

Also, PM Chinh asked delegates to focus on reporting and discuss the main contents. The first focus is to evaluate the implementation of national digital transformation since the 7th session with a focus on developing the digital economy in the spirit of objectivity, honesty, and demonstration with specific data (achievements, disadvantages, limitations, barriers, bottlenecks, and causes).

The second is to share good practices that result in high efficiency and analyze its lessons. Thirdly, the report is to include key solutions to best implement the tasks, which have been proposed in the Committee's 2024 Work Plan, especially breakthrough solutions.

Creating legal corridor to promote digital transformation

At the meeting, the representative of the Ministry of Information and Communications (MIC) said that in recent times, digital transformation has achieved many important results. The Government and Prime Minister issued many important legal documents, creating a legal corridor to promote digital transformation. Also, ministries, branches, and localities have issued many important documents to support the promotion of digital transformation.

The Prime Minister issued the 2024 Work Plan of the National Committee on Digital Transformation; and chaired the meeting to resolve problems with the allocation and use of funds to serve the implementation of Project 06/CP.

There are 21 ministries, branches, and 62 localities that have issued the Digital Transformation Plan for 2024. 19 ministries and ministerial-level agencies; Vietnam Social Insurance and 63/63 localities have issued a Plan to implement Project 06/CP. The number of ministries and branches that have not yet issued its Plan is 3. On the other hand, 14 ministries, branches, and 52 localities have issued a list of databases according to regulations, reaching a rate of 77%, an increase of 11% compared to 2023.

Also, State agencies continue to effectively operate the National Database in socio-economic management and administration. Connecting and sharing data continues to be promoted by ministries, branches, and localities, utilizing the maximum value of data.

The national population database has been connected to 18 ministries, branches, 63 provinces, cities, and 4 businesses. The database successfully synchronized over 268 million people's information; receiving more than 1.5 billion requests for information verification (an increase of 213 million compared to 2023). The national data sharing and integration platform has connected with 388 systems and databases of 95 agencies and units participating in the connection. On average, there are about 2.8 million transactions per day. The total number of transactions to date is about 2 billion transactions.

Regarding digital infrastructure development, currently, 80.2% of households use fiber optic broadband internet cables. Nationwide, 100% of communes connect to fiber optic internet. The 4G mobile broadband covers 99.8% of the population with stable quality. The MIC has organized a 5G frequency auction for 2 frequency band blocks and will soon auction 1 more block.

In the first quarter of 2024, Vietnam will have 1 more Viettel data center opened, providing services to the market with a total of 2,400 racks.

Regarding the development of Digital Government to provide online public services to people and businesses, 80.44% of all administrative procedures that qualify for the entire process are online; 47.79% of which qualify for providing the entire procedures. Still, there are only 38.3% of dossiers resolved with administrative procedures done online.

The MIC stated that, regarding digital economic development, the proportion of digital economy/GDP in 2021 and 2022 are 11.91% and 14.26%, respectively. The proportion of digital economy/GDP in 2023 is estimated to be 16.5% with a growth rate of 20%, 3 times higher than GDP growth.

EconomySEA report by Google, Temasek, and Bain evaluates Vietnam's digital economic growth rate as the fastest in Southeast Asia for 2 consecutive years (2022 reaching 28%, 2023 reaching 19%), 3.5 times higher than the speed of its GDP growth rate. The proportion of the digital economy/GDP of Vietnam in 2025 is forecasted to reach over 20%.

Regarding digital society development, the Ministry of Public Security has issued over 86 million chip-embedded identification cards; received over 74.85 million electronic identification records, and activated over 53.62 million electronic identification accounts for people (reaching 71.63% of received records). VNeID application has integrated 8 utility services with 29.3 million visits so far.

The results of digital society development also include 100% of medical examination and treatment facilities, and 100% of medical training facilities with cashless payment services. About 64% of people receive social insurance and unemployment benefits in urban areas through personal accounts and 77% of working adults have payment accounts at banks.

The alarming situation of personal data being exploited, traded illicit

The representative of the MIC also clearly pointed out that in building and perfecting the regime, a number of decrees guiding the law have been gradually implemented by the Government and the Prime Minister to ministries and branches. However, the review and adjustment of legal documents to simplify administrative procedures related to processing citizenship documents is slow.

In particular, the organizational structure to improve state management capacity on digital transformation is enhanced at a slow pace in many ministries, branches, and localities. They are yet to have a plan to implement the Project on strengthening the organizational structure and improving State management capacity and law enforcement on digital transformation from central to local levels until 2025, with a vision for 2030.

As mentioned, the ratio of documents submitted online to the total number of documents processed for administrative procedures is still low, only reaching about 38.3%. The implementation and restructuring of administrative procedures of ministries, branches, and localities is still slow, even though there are specific regulations and instructions from the Government Office.

There are 20 ministries, branches, and localities that have not issued a list of databases and 31 ministries, branches, and localities that have not issued a list of open data. The situation of personal data being exploited, and traded illicitly remains an alarming issue.

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