Vietnam and the smart era

On 22 January 2025, Vietnamese Prime Minister Pham Minh Chinh attended and spoke at a discussion session at the World Economic Forum (WEF) in Davos – Switzerland. The title of the session was “ASEAN: Connected for Greater Progress”. The session focused on ASEAN’s opportunities and challenges in the era of smart technology, also called the “smart era”. We found this to be a good opportunity to see where Vietnam currently is with regard to digitalization and artificial intelligence (AI). Furthermore, in this blog post we are going to have a look at how the country intends to develop and even excel in this exciting smart era.

Flourishing digital tech landscape

For starters: Vietnam’s digital technology sector has recently witnessed exponential growth. The country is now home to nearly 74,000 digital companies. Meanwhile, the digital economy has already begun to contribute significantly to Vietnam’s GDP. This growth appears to be a result of Vietnam’s substantial investment in digital infrastructure, and a Government-focused strategy aimed at developing a digitally integrated economy.

Vietnamese cities such as Hanoi, Ho Chi Minh City, and Da Nang are becoming hubs for technological innovation. These hubs are not only fostering homegrown innovation. They are also attracting foreign investments, making Vietnam an increasingly important player in the global digital landscape. Just take the examples of NVIDIA, Sumitomo, Rikkeisoft, who all announced significant investments in Vietnam. We further reported about Vietnam’s IT and AI opportunities in a recent post on our website.

The Government’s commitment to digitalization is part of its broader economic strategy to transform industries and improve access to technology for all Vietnamese citizens. Through initiatives like the “National Digital Transformation Program”, the country aims to increase digital literacy and ensure that it will not leave any regions behind as the digital economy expands. This initiative has resulted in increased access to services like e-health and e-learning, which are transforming the way healthcare and education are delivered, particularly in rural areas.

The role of AI in Vietnam’s smart era

AI is a key force shaping Vietnam’s technological landscape. Across multiple sectors, it is driving productivity gains, reducing inefficiencies, and fostering innovation. In manufacturing, for example, AI-powered automation is streamlining production lines, optimizing supply chains, and improving product quality. These advancements help businesses stay competitive in the global marketplace, especially in industries such as electronics and textiles, where Vietnam has established itself as an important player.

AI also plays a significant role in agriculture, where smart farming technologies are improving crop management and boosting yields while minimizing environmental impact. By using AI-powered sensors, drones, and data analytics, farmers are able to monitor soil conditions, optimize irrigation, and reduce pesticide usage. This not only enhances agricultural productivity but also contributes to sustainability by reducing the environmental footprint of farming.

Healthcare is another field where AI is increasingly finding useful application. For example, AI technologies are helping improve the quality of care, particularly in underserved areas. Telemedicine platforms, AI-based diagnostic tools, and digital health records are expanding access to healthcare services while reducing costs. These innovations are crucial as Vietnam works to build a more resilient and inclusive healthcare system.

Vietnam and sustainable development

Vietnam’s commitment to sustainable development is another key feature of the country’s future vision. While digitalization and AI offer significant economic opportunities, the Government is also aware of the need to integrate environmental concerns into this growth. This awareness can be seen, among other things, by looking at Vietnam’s National Action Plan for the implementation of the United Nations sustainable development goals (UNSDG). A little while ago, we wrote another blog about these sustainability goals.

Indeed, the Vietnamese Government is pursuing a green economy model, which emphasizes on renewable energy, circular economy practices, and sustainable infrastructure development. For example, the country’s abundant solar and wind resources have positioned Vietnam as a frontrunner in the development of clean energy projects in Southeast Asia. Another example is the recent commitment of a private infrastructure development group. Earlier this month, they committed to invest USD 20 million in CME Solar, which is a prominent player in Vietnam’s commercial and industrial solar energy sector.

In addition to renewable energy, Vietnam is integrating green infrastructure into its urbanization strategy. So – called “smart cities” cities are being developed to combine digital technologies with environmentally sustainable designs. These cities feature energy-efficient buildings, waste management systems, and smart transportation networks that reduce the carbon footprint of urban living. The idea is that the emphasis on sustainability will make Vietnamese cities more liveable while preparing them for future challenges posed by climate change and rapid urbanization.

Getting ready for the smart area

Vietnam is steadily embracing digitalization, AI, and sustainability. This hopefully lays the foundation for a “smart era”, where technology and environmental responsibility work in tandem to drive economic development. As the digital economy continues to grow, the Government of Vietnam has committed to create an inclusive digital ecosystem that fosters innovation while addressing the needs of its people. By investing in digital infrastructure, expanding access to technology, and ensuring that digital transformation benefits all regions of the country, Vietnam seems to be paving the way for a resilient and equitable economy.

At the same time, Vietnam’s commitment to sustainability hopefully guides the country toward a low-carbon future. By harnessing the power of renewable energy, smart cities, and green technologies, Vietnam is not only positioning itself as a frontrunner in Southeast Asia. It is also contributing to global efforts to combat climate change. In collaboration with international organizations such as the UNDP and the World Bank, Vietnam is getting ready to address the most pressing challenges of our time. From climate change to poverty reduction and social inclusion.

Vietnam’s journey toward the smart era is an example of the power of digital transformation working hand in hand with sustainability. A flourishing digital technology sector, a commitment to AI integration, and a focus on renewable energy and green infrastructure, Vietnam seems to have the ingredients for long-term economic success. As the country strengthens its partnerships with global organizations, it is well-positioned to tackle the challenges of the 21st century while ensuring that its growth benefits both its and the planet.

VNHL is here to help you

At VNHL, we closely follow the news and developments regarding business, investment, and living in Vietnam. Especially topics that touch on the topic of developing Vietnam in a sustainable way are of high interest for us. We recently wrote a blog post about the United Nations sustainable development goals (quoted above), and also one about the OECD guidelines on responsible business conduct. We believe that sustainability is a relevant topic, especially now that there is more and more legislation on this topic in the European Union. If you have any questions about these (or other) topics: you can reach out to us via the chat button on the right of this page, or via our contact us page for further information and questions. Our three main services are: (i) consulting, (ii) networking, and (iii) supporting. We look forward to hearing from you and to supporting you.

*Dear reader, even though our VNHL Consulting team always tries its very best to provide its Clients with correct and complete info: we are not a Vietnamese law firm. The information in this post is therefore not meant to, and should also not be construed to, constitute legal advice. For specialized advice in the fields of law, accounting, tax, etcetera: we always recommend our Clients to speak with qualified specialists in those fields. We have several such specialists in our nationwide network, and we are always happy to introduce our Clients to them, when appreciated.