Vietnam needs more “Innovation 4.0”

“Vietnam needs to shift its strategy to an economy based on productivity and innovation and make the most of the existing gold population to maintain high-quality growth in the next decade.”

This is one of the recommendations stated in a joint report by the World Bank and the Vietnam Academy of Social Sciences in order to find a new economic growth model to help Vietnam grow high quality economic in the period 2021-2030.

The research results show that the labor-intensive, export-driven growth model that Vietnam pursued for the period 2011–2020 has become obsolete in the context of Industry 4.0 and many new factors such as global value chains have been nearing completion, early industrialization and service play an increasingly larger role.

Experts said that if Vietnam wants to avoid the middle income trap, it must maintain an annual growth rate of 7.0 to 7.5% during 2021-30, higher than the average of 6.3% in the last 10 years.

The research report, proposed a new economic model for Vietnam in the period of 2021-2030 focusing on three breakthrough areas: promoting innovation and entrepreneurship, developing human capital, and building modern institutions.

According to Mr. Ousmane Dione, Country Director of the World Bank in Vietnam, the achievements that Vietnam has achieved to date are noticeable results from the first Doi Moi reforms in 1986, as well as a series of follow-up strong market reform. Today, Vietnam needs another Innovation to achieve its aspiration to become a modern, high-income country by 2045. Living in an era of disruptive technologies, is both a challenge and an opportunity, it’s “Innovation 4.0”.

For Vietnam today, creating a favorable business environment, promoting innovation and creativity at the enterprise level will be more effective than measures controlled by popular supply such as increasing spending on research and development or focus on inventions and inventions.

The next problem is implementation. Mr. Ousmane Dione analyzed that Vietnam’s current development challenges are much more complex than in the past 30 years. Part of this complexity stems from the fact that development issues are becoming increasingly multidisciplinary. Poverty reduction requires not only improving economic life, but also improving basic services and developing human capital. Similarly, human capital development is not only about education, but also about health care throughout the life of the people as well as the elderly and social protection. The nature of interregional development and private sector development is also multidisciplinary. To address these complex issues, strong leadership and determination is required. At the same time, it is necessary to have an effective management and development system, ensuring a smooth coordination both horizontally between government ministries and verticals between levels of government from central to local levels.

“Continued strong institutional reforms to address fundamental weaknesses related to the way the government provides services to businesses and citizens will be key to successfully implementing these strategies,” he said. Ousmane Dione said.

Productivity and Quality Office