Scams that work make money

The 4.0 industrial revolution means the digitization of traditional manufacturing and production methods

At the Hoa Phat Hai Duong Steel Complex, the technological solution of recalling heat from the coking process and blast furnaces producing gas can help save VND800 billion a year.

The complex plans to set up more items in 2021 to make the best use of the heat and gas produced during the steel refining process, raising the total electricity generation capacity to 110 MW, which allows 100 percent electricity support for production.

The yearly savings on fuel thanks to the heat and emission recovery solution at Hoa Phat’s steel complexes are estimated at VND4 trillion from 2021.

Setting up a xproduction headquarters in Dung Quat Export Processing Zone in Quang Ngai province, Hoa Phat Group has turned a project abandoned by foreign investor for decades into a leading steel manufacturing complex in Vietnam.

At the Dung Quat Steel Complex, two buildings are used for the automatic steel analysis center and the physico-mechanical property testing center, valued at over VND100 billion.

This is the most modern sampling system in the world today with the entire process of taking, processing, analyzing samples and giving results implemented automatically. It takes no more than 2 minutes and 30 seconds to get test results for steel samples.

If a country has not developed OT, it cannot create a lot of opportunities and large environments to put IT into application. Thus, both OT and IT need to be developed in the context of the 4.0 revolution, especially in developing countries where OT is still not diverse as it is in developed countries.

The Da Nhim – Ham Thuan – Da Mi Hydropower JSC (DHD) is running four hydropower plants (Da Nhim, Song Pha, Ham Thuan and Da Mi), located in the provinces of Ninh Thuan and Binh Thuan. The head office of the company is located in Lam Dong province.

In 2012, the company decided to build an OCC (operations control center) which runs power plants from a distance. With OCC, it needs just 2-3 workers for each duty shift instead of tens of workers as previously applied.

OCC is a system that connects information systems, serving as a digital thread that connects separate data. It is used as an integration center with many functions to manage all the plants belonging to DHD.

A representative of EVNGenco1 said DHD is considering applying AI and Data Mining algorithms with the forecasting and warning capability based on the big data that OCC has.

At Ban Ve Hydropower Plant, the application of 4.0 technologies is believed to be the shortest way to make a breakthrough and improve production capacity.

The plant is implementing a lot of projects using high technologies, including an online electricity generation unit monitoring system; an alerting system which gives data about accidents with messages; and a bar code-based material and equipment management system. It is also utilizing AI and Big Data to build a system to forecast the water flow to hydropower reservoirs.

Use high tech or lag behind

According to the Ministry of Investment and Trade (MOIT), the 4.0 industrial revolution means the digitization of traditional manufacturing and production methods.

In the past, only some stages of the production process were automated with IT application. But now, automation is carried out in a much larger scale than what was seen in 1970s, the early days of the third industrial revolution.

The 2019 Vietnam Industry White Book summarizes the global trends on digital transformation. Total digital transformation takes place when everything is connected with the Internet thanks to the combination of operational technology (OT) with information technology (IT), creating a virtual space that is a copy of the real world, and a completely new model of production and consumption.

If a country has not developed OT, it cannot create a lot of opportunities and large environments to put IT into application. Thus, both OT and IT need to be developed in the context of the 4.0 revolution, especially in developing countries where OT is still not diverse as it is in developed countries.

Vietnamese enterprises for many decades have been described as using outdated technologies. The remarks have been repeated through years in government agency reports.

However, enterprises in recent years have been more aware of the importance of high technology use in production. If they continue to apply old technologies, the plan of entering the world market will be just a dream. Only when using high technology will Vietnam’s products have the opportunity to “compete equally” in quality with foreign products.

Ha Duy

Mai Quoc Huy is neither an outstanding student nor a teacher’s favorite. However, the 16-year-old student used the skills he has learned through first-hand experience to earn first prize at the Ho Chi Minh City Informatics Competition for Youth 2018.

Huy might spend most of his free time helping his father sell second-hand speakers and repairing his neighbors’ electric devices, but every now and then he finds a reason to sneak off to local bookstores and read up physics, electricity, and programming.

Though he is just an ordinary student from a low-income family, his ability to remember even the smallest detail of electrical devices is a skill others can only dream of.

A ninth grader who can turn bikes from manual to electric

Thanks to his teacher’s proposition, Huy was chosen to represent Ban Co Middle School in District 3, Ho Chi Minh City at two municipal competitions: the Science Fair for Daily Inventions and Informatics Competition for Youth, both of which awarded him first prize for his submission: his grandfather’s old bicycle installed with a motor, throttle, and solar batteries to turn it into an electric bike

Having joined the competition for the first time, Huy was funded with VND1 million (around US$43) for the project.

To parents’ and neighbors’ surprise, Huy’s electric bicycle, able to reach speeds of 40kph, was awarded two first prizes and qualified for the national competition to be held in August.

Now, Huy is putting the final touches on his “invention” to prepare for the upcoming event.

The bicycle is not only special because it is powered by solar energy, it also has other features that most bicycles do not, mostly inspired by Huy’s own experience as a cyclist.

“One time I went to visit a friend in Cho Ray Hospital and my bicycle was moved to a new spot in the gigantic parking lot. When I got home, I decided that I would equip the bike with some of the convenient features that motorbikes have, such as radio waves (RF) that can help find the vehicle more easily,” Huy said.

Many people believe that bikes are not a valuable, but for Huy, it is his most important asset. Hence, the boy was determined to design a GPS system to prevent theft.

The young inventor proudly presented his most recent addition to the bike: a feature that allows any phone to send a text message and be informed of the bike’s location, no matter where it is.

“Each text message costs VND200 [less than one cent] but I am still finalizing a system to send the data through the Internet to save money,” the student revealed.

As impressive as the features may seem, there are still many more the 16-year-old hopes to add in the future, such as automatic headlights, break lights, and automatic indicators which sensor tilting movement.

All these functions would make riding a bicycle not only significantly more convenient, but also much safer.

Phan Nguyen Truc Phuong, Huy’s engineering instructor at the Science Development Center for Youth under the Ho Chi Minh City chapter of the Ho Chi Minh Communist Youth Union, is a full supporter of Huy’s ideas.

“Even though Huy’s idea is not new, it is very practical since it results from daily lives,” she said.

Huy’s self-studying journey

Having grown up in a working-class neighborhood on Vuon Chuoi Street in District 3, Huy is more than used to the sounds of loud motors, local working, and construction.

However, it was only recently that he began to involve himself in his father’s blue-collar profession.

“Being a motor repairman is a tiresome and unstable job. It only provides for my family’s most basic needs so I do not want my son to follow in my footsteps,” said Huy’s father, Mai Hoang Ha.

“But I still show him a few simple things to be able to make a day-to-day living, repair his own vehicle, and help others in the neighborhood. He first became interested in repairing electric devices around the house in grade eight so I decided to show him a few small things. Since then, I’ve let him experiment on his own and only watched him for safety. I don’t know much about automating so I haven’t been able to help him much with that.”

Fully aware of the family’s financial situation, Huy tries to avoid asking his parents for extra money. Instead, he saves up his allowance to buy what he needs for his projects.

With just VND20,000 ($0.9) a day, every few days Huy saves enough money to visit Nhat Tao Market, Ho Chi Minh City’s most well-known electrical component market.

The books provided at his school do not supply the young inventor with the knowledge he needs so he goes to bookstores to look for higher level books on physics.

“I want to have a better understanding of electricity but the technology and physics classes at school only provide brief and basic knowledge. In order to gain a thorough understanding I need to try and understand those subjects myself. I usually use my days off to go to the bookstore and read,” Huy said.

“Books about programming and electronic circuits are all very thick. I am able to understand small parts of them, but I haven’t been able to apply much of the knowledge. Each book costs over VND100,000 so I only “borrow” them to read in the bookstore. I can’t buy them because then I wouldn’t have enough money for component parts.”

Vocational training is good enough to make a proper living

Having received results of entrance exams for high school, Huy was happy to score 30 out of 50.

“Attending top schools will not allow time to play, especially to experiment with electric devices. I am going to choose a school suitable for my capability, near my home and provides vocational training,” Huy said.

“Everyone wants their children to attend college. But if he’s not capable of it, I am happy to let him study in a vocational school for electronics, or anything he enjoys as long as he will be capable of making a living. Being a motor repairer, I have seen many youngsters who finished 12th grade but are still only drivers or work as attendants at supermarkets. I let my son study whatever he likes. I do not want to decide his own life,” Huy’s father said.

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Nguyen Khac Giang

The other day, I went for a bun cha on Duy Tan Street in Hanoi’s Cau Giay District.

The street, which bustles with offices, coffee shops and a wide range of eateries, hosts many sidewalk stalls that serve traditional Vietnamese dishes like pho , banh mi and bun cha (rice vermicilli with pork pies).

I usually have lunch on the sidewalks in Hanoi, spending around VND50,000 ($2.15) per meal, which I find affordable and convenient. That day, a young employee suggested that I pay the small bill with a mobile app.

Curious, I agreed, and with the staff’s guidance, it took less than a minute to set up the app and pay for lunch. In return, I received a 15 percent discount for the bill, which was nice. I felt good.

Then I began thinking about all the advantages of a cashless society that the Vietnamese government and other governments have targeted. The advantages of e-commerce were starkly evident during the social distancing campaigns necessitated by the Covid-19 outbreaks.

Across Vietnam’s densely populated cities, payment through apps has become a regular part of personal transactions, something that is likely to make tax authorities smile. Mobile wallets are replacing the polymer banknotes, not just via e-commerce, but also in trading between individuals, between customers and restaurants, and even between individuals and street vendors.

I asked the Duy Tan Street eatery how the app payment method helps. They responded without hesitation that the benefits were quite clear – it was convenient for both the customers and businesses, saved a lot of time for both parties, was safe and in most cases, that app was either free or cost very little.

A mobile wallet app in Vietnam announced recently that it has had tens of millions of users and hundreds of thousands of stores and restaurants that allow customers to use it for payment. With such an attractive market, it is obvious that businesses that are giants in other areas, like telecommunications, phone manufacturing and ride-hailing services, have also joined the race to launch their own digital payment services.

In the Digital Money Index report released by Citibank last year, Vietnam ranked 61st among 84 countries in digital money readiness. It was 59th in terms of government and market support, 63rd for financial and technology infrastructure and the same position for presence of digital money solutions, and 56th for propensity to adopt.

The government has been working assiduously towards creating a cashless society. It launched a national five-year (2016-2020) program for developing non-cash payment in Vietnam and there are some obvious impacts to be applauded.

A woman guides another to use an e-wallet called MoMo for payment in HCMC, November 2020. Photo coutersy of MoMo.

The other side

As the restaurant staff informed me, a cashless economy has evident benefits. People would feel safer, worrying less about losing their wallet, money and other stuff. Sellers will not have to take the trouble to prepare enough cash to give as change to customers, spend a lot of time on bookkeeping or investing in a safe box. It will be easier for the state to collect taxes, and estimate the size of the informal economy because there is more data on the spending activities of people, small businesses, business households or even street vendors.

But we have to go beyond the obvious benefits when we assess a new, hi-tech convenience.

Right off the bat, it is not going to be very easy to digitize money in Vietnam.

Most Vietnamese people in the countryside do not make it a practice to have bank accounts, let alone using a mobile app on their smartphone for payment.

The explosion of payment applications in urban areas easily leads to inequality, with some large groups of people having no access to technology in rural areas.

But even more important is the issue of security risks.

Not having to worry about being robbed on the streets is fine, but if our accounts are attacked, what we lose would be much more than the money we carry on our person.

It’s a fact that there have been more and more cases of fraudsters appropriating money through digital banking transactions or telephone transactions. This shows that many people and even banks have not fully anticipated all the security risks posed by the digital age.

Equally important is the issue of privacy and individual freedom.

The information on personal spending can reveal a lot about one person, especially with the help of the AI technology that tracks users’ behavior and analyzes big data.

For example, if one is recorded as spending a lot on fast food and food with high sugar content, it is not difficult for some life insurance firm or healthcare service to have that information to approach that person sooner or later. And obviously with a higher risk of illness, they will charge that person higher premiums.

In some countries, a system to rank its citizens has been established, based on such personal information gathering and analysis. Like private financial credit scores, a person’s social scores can move up and down according to this recorded behavior. Low scoring citizens can be limited from certain services and their accounts can be blocked easily.

By the end of 2018, China had banned up to 23 million people from buying plane or train tickets as part of the nation’s “social credit” system.

As citizens, we do not want to have a third or fourth party access our billing information.

Japan, surprisingly, is one of countries still in favor of cash. It is one of the most cash-based economies in the advanced world, government statistics show, with its cashless ratio below 20 percent against 96 percent in South Korea and 66 percent in China, Reuters said in a report last December.

According to the Financial Times , up to 60 percent of restaurants in Tokyo only accept payment in cash.

Cash, in fact, represents many of the characteristics that people prefer. It ensures anonymity and no traceability, it is easy to use and tally, it saves one from worries about banking security, and it is easy for one to control her or his spending behavior than using a card because they will have the tendency of not spending more than the sum they are carrying with them.

In a society that is still transitioning and the tax system is not really fair, cash is the only way for many people to run their businesses without paying bruising taxes. This is the case not just in Vietnam. Many stores and restaurants I have visited in other countries require customers to pay in cash.

Can the benefits of digitalization be reconciled with the loss of privacy and the intrusion of AI into our spending and reading habits, as is already happening in a big way? Can service providers and the government guarantee that our personal information will not be used against us or abused for purposes that individuals have no say over?

Can we develop a clear and transparent legal system and build public trust in the integrity of the state apparatus?

The answers to these questions have far-reaching implications for us, individually and as a society.

Consumer confidence and trust cannot be digitized very easily; but is there going to be a digital solution to fixing it, once it’s broken?

We need to ponder this before the fix is in.

Bribery, embezzlement, money laundering and abuse of power are among the accusations leveled against dozens of Saudi princes, officials and businessmen detained in an anti-corruption probe, a Saudi official told Reuters on Monday.

Eleven princes, four ministers and tens of former ministers were detained late on Saturday after King Salman decreed the creation of an anti-corruption committee chaired by Crown Prince Mohammed bin Salman, his 32-year-old son who has amassed expansive powers over the past two years.

The new body was given broad powers to investigate cases, issue arrest warrants and travel restrictions, and seize assets.

The official said billionaire Prince Alwaleed bin Talal, a nephew of the king and owner of investment firm Kingdom Holding 4280.SE, faces allegations of money laundering, bribery and extorting officials.

Prince Miteb bin Abdullah, who was removed as head of the powerful National Guard, is accused of embezzlement, hiring ghost employees and awarding contracts to his own companies, including a $10 billion deal for walkie-talkies and bulletproof military gear worth billions of Saudi riyals.

Former Riyadh Governor Prince Turki bin Abdullah is accused of corruption in the Riyadh Metro project and of taking advantage of his influence to award contracts to his own companies, the official said.

Former Finance Minister Ibrahim al-Assaf, a board member of national oil giant Saudi Aramco, is accused of embezzlement related to the expansion of Mecca’s Grand Mosque and taking advantage of his position and inside information to benefit from land deals, the official added.

Saudi Arabian Prince Al-Waleed bin Talal arrives at the Elysee palace in Paris, France, to attend a meeting with French President, September 8, 2016. REUTERS/Philippe Wojazer

Future Saudi king tightens grip on power

Saudi Arabia’s future king has tightened his grip on power through an anti-corruption purge by arresting royals, ministers and investors including billionaire Alwaleed bin Talal who is one of the kingdom’s most prominent businessmen.

Prince Alwaleed, a nephew of the king and owner of investment firm Kingdom Holding 4280.SE, invests in firms such as Citigroup and Twitter. He was among 11 princes, four ministers and tens of former ministers detained, three senior officials told Reuters on Sunday.

The purge against the kingdom’s political and business elite also targeted the head of the National Guard Prince Miteb bin Abdullah, who was detained and replaced as minister of the powerful National Guard by Prince Khaled bin Ayyaf.

The allegations against Prince Alwaleed include money laundering, bribery and extorting officials, one official told Reuters, while Prince Miteb is accused of embezzlement, hiring ghost employees and awarding contracts to his own companies including a $10 billion deal for walkie talkies and bulletproof military gear worth billions of Saudi riyals.

News of the purge came soon after King Salman decreed late on Saturday the creation of an anti-corruption committee chaired by Crown Prince Mohammed bin Salman, his 32-year-old favorite son who has amassed power since rising from obscurity three years ago.

The new body was given broad powers to investigate cases, issue arrest warrants and travel restrictions, and seize assets.

“The homeland will not exist unless corruption is uprooted and the corrupt are held accountable,” the royal decree said. Analysts said the arrests were another pre-emptive measure by the crown prince to remove powerful figures as he exerts control over the world’s leading oil exporter.

The roundup recalls the palace coup in June through which he ousted his elder cousin, Mohammed bin Nayef, as heir to the throne and interior minister.

MbS, as he is known, was expected to follow at least by removing Prince Miteb from leadership of the National Guard, a pivotal power base rooted in the kingdom’s tribes.

Over the past year, MbS has become the ultimate decision-maker for the kingdom’s military, foreign, economic and social policies, causing resentment among parts of the Al Saud dynasty frustrated by his meteoric rise.

Saudi Arabia’s stock index .TASI was dragged down briefly but recovered to close higher as some investors bet the crackdown could bolster reforms in the long run.

The royal decree said the arrests were in response to “exploitation by some of the weak souls who have put their own interests above the public interest, in order to, illicitly, accrue money.”

Saudi Arabia’s King Salman attends a meeting with Russian President Vladimir Putin (not in the picture) in the Kremlin in Moscow, Russia October 5, 2017. Photo by Reuters/Yuri Kadobnov/Pool

Reform agenda

The line between public funds and royal money is not always clear in Saudi Arabia, an absolute monarchy ruled by an Islamic system in which most law is not systematically codified and no elected parliament exists.

WikiLeaks cables have detailed the huge monthly stipends that every Saudi royal receives as well as various money-making schemes some have used to finance lavish lifestyles.

Analysts said the purge aimed to go beyond corruption and aimed to remove potential opposition to Prince Mohammed’s ambitious reform agenda, which is widely popular with Saudi Arabia’s burgeoning youth population but faces resistance from some of the old guard more comfortable with the kingdom’s traditions of incremental change and rule by consensus.

In September, the king announced that a ban on women driving would be lifted, while Prince Mohammed is trying to break decades of conservative tradition by promoting public entertainment and visits by foreign tourists.

The crown prince has also slashed state spending in some areas and plans a big sale of state assets, including floating part of state oil giant Saudi Aramco on international markets.

Prince Mohammed has also led Saudi Arabia into a two-year-old war in Yemen, where the government says it is fighting Iran-aligned militants, and a row with neighboring Qatar, which it accuses of backing terrorists, a charge Doha denies. Detractors of the crown prince say both moves are dangerous adventurism.

The most recent crackdown breaks with the tradition of consensus within the ruling family, wrote James Dorsey, a senior fellow at Singapore’s S. Rajaratnam School of International Studies.

“Prince Mohammed, rather than forging alliances, is extending his iron grip to the ruling family, the military, and the National Guard to counter what appears to be more widespread opposition within the family as well as the military to his reforms and the Yemen war,” he said.

Scholar Joseph Kechichian said the interests of the Al Saud, however, would remain protected.

“Both King Salman and heir apparent Mohammed bin Salman are fully committed to them. What they wish to instill, and seem determined to execute, is to modernize the ruling establishment, not just for the 2030 horizon but beyond it too,” he said.

Many ordinary Saudis praised the crackdown as long-awaited.

Opulent Hotel

A Saudi official said former Riyadh Governor Prince Turki bin Abdullah was detained on accusations of corruption in the Riyadh Metro project and taking advantage of his influence to award contracts to his own companies.

Former Finance Minister Ibrahim al-Assaf, a board member of national oil giant Saudi Aramco, was also detained, accused of embezzlement related to the expansion of Mecca’s Grand Mosque and taking advantage of his position and inside information to purchase lands, the official added.

Other detainees include ousted Economy Minister Adel Fakieh, who once played a major role in drafting MbS’ reforms, and Khalid al-Tuwaijiri, who headed the Royal Court under the late King Abdullah.

People on Twitter applauded the arrests of certain ministers, with some comparing them to “the night of the long knives”, a violent purge of political leaders in Nazi Germany in 1934.

Bakr bin Laden, chairman of the big Saudi Binladin construction group, and Alwaleed al-Ibrahim, owner of the MBC television network, were also detained.

At least some of the detainees were held at the opulent Ritz-Carlton hotel in the diplomatic quarter of Riyadh, said sources in contact with the government and guests whose plans had been disrupted.

The hotel’s exterior gate was shuttered on Sunday morning and guards turned away a Reuters reporter, saying it had been closed for security reasons, although private cars and ambulances were seen entering through a rear entrance.

The hotel and an adjacent facility were the site of an international conference promoting Saudi Arabia as an investment destination just 10 days ago attended by at least one of those now being held for questioning.

The detentions follow a crackdown in September on political opponents of Saudi Arabia’s rulers that saw some 30 clerics, intellectuals and activists detained.

Prince Alwaleed, a flamboyant character, has sometimes used his prominence as an investor to aim barbs at the kingdom’s rulers.

In December 2015, he called then-U.S. presidential candidate Donald Trump a “disgrace to all America” and demanded on Twitter that he withdraw from the election.

Trump responded by tweeting: “Dopey Prince @Alwaleed_Talal wants to control our U.S. politicians with daddy’s money. Can’t do it when I get elected.”

His father, Prince Talal, is considered one of the most vocal supporters of reform in the ruling Al Saud family, having pressed for a constitutional monarchy decades ago.

Thursday noon, a day before Tet , the Lunar New Year, when most migrants return home to celebrate the most auspicious and important event with loved ones, a group of more than ten engineers and workers were working like any normal day. They were working on a project to build an underpass at the junction of Nguyen Van Linh and Nguyen Huu Tho streets in District 7.

Most of the workers in the group are from the Mekong Delta provinces of Can Tho, Long An and Tien Giang. Though their hometowns are not very far from the city, they won’t return home for the Lunar New Year.

They have good reasons for not returning. For one, they can take advantage of the Tet break when not many people are on the streets to speed up work, as encouraged by the city administration and the project investor. Also, they want to earn more money to make up for a year when their income was slashed heavily by the pandemic.

“It is heartbreaking that I am not home now to with my family, but I’ve pushed myself to try and work harder. I can visit home after Tet ,” said Nguyen Truong Nghia, 28, a native of Can Tho City.

Nguyen Truong Nghia works at an underpass in HCMC’s District 7, February 11, 2020. Photo by VnExpress/Gia Minh

Nguyen Nam Hai, in charge at the construction site, said that during the seven-day Tet break that started Wednesday, workers will work in two shifts as usual – one in the morning and another in the afternoon.

“Apart from Tet , which allows people to stay at home longer, the ongoing Covid-19 outbreak has prevented them going out, which creates good conditions to speed up the project,” he said.

Since January 28, when community transmissions returned to Vietnam after 55 clean days, the cluster in HCMC is yet to be contained.

Work began on the underpass last April to ease the burden for traffic flow in the southern part of the city. The entire project will see two underpasses running under the junction. It is expected that both will be completed within next year.

Seven kilometers (4.35 miles) away from the underpass, around 30 engineers and workers are also working hard on upgrading the Nguyen Huu Canh Street, which runs through Binh Thanh District to link downtown District 1 with District 2.

As this route is the artery for the eastern gateway of the city and usually attracts a large number of vehicles, the Tet break grants more time for this crucial project to be finished on time.

Pham Thanh Tuan, 32, said his wife and he have decided to stay back to save the cost of traveling home in the northern province of Thai Binh, and earn some extra income to take care of their six-year-old son.

Pham Thanh Tuan at the construction site to upgrade Nguyen Huu Canh Street in HCMC’s Binh Thanh District, February 11, 2021. Photo by VnExpress/Gia Minh

The project to upgrade the 3.2 km-long street by elevating subsided sections notorious for causing frequent flooding was launched in October last year at a cost of VND470 billion ($20.39 million).

Scheduled for completion in April, around 65 percent of the project has been completed – that of elevating the surface of the street at severely subsided sections while keeping other parts at the same height to ensure the water drainage system works well.

Tuan and other workers are working on a 500-meter-long section of the street from an underpass in front of The Manor building to the Nguyen Huu Canh Overpass that typically suffers the heaviest subsidence. The section has been lifted by 50 cm to 1.2 m.

This is the first time that Tuan and his wife are spending Tet in HCMC.

He said: “The salary during Tet days is three times higher than normal days and therefore, I have decided to stay and work. Throughout last year, because of the pandemic, my wife and I have suffered financially, so we’re trying to make up for that.”

High technology and innovation are the keys for Vietnam to escape the status of doing outsourcing for foreigners

“If we are not brave enough to invest in science and technology and innovation, we will get stuck in the low-productivity, low-added value and middle-income trap,” Prime Minister Nguyen Xuan Phuc said recently at a groundbreaking ceremony in Hoa Lac Hi-tech Park in Hanoi.

Investing in technology and innovation is extremely important for Vietnam to bring products to a new height and escape the status of doing outsourcing for foreigners which the country has been clinging to for decades.

This is not only true for technology firms but for all enterprises in the economy. Applying and inventing new technologies can help increase productivity and heighten enterprises’ positions.

Electric cars and smartphones are tangible products which can show the resilience of Vietnamese enterprises in the 4.0 era.

Established in 2008 and starting at the bottom of the ranking of commercial banks in the first four years of operation, TP Bank decided that it would digitize and apply high technologies even in its early days.

“TP Bank understands that it needs to digitize to become a digital bank, or it won’t be able to compete with large longstanding banks,” a representative of the bank said at a digital technology business development forum in 2020.

Meanwhile, Viettel is building a digital business culture with the focus on flexibility, creativity, customer orientation, digital thinking and openness.

It has accelerated digital transformation in internal administration, applying modern technologies with international standards. All documents at Viettel have been digitized, 50 percent of manual work has been liberalized, and 30-40 percent of tasks have been automated.

Its ecosystem of digital products provide B2C and B2B services in a wide range of fields, from finance (Viettelpay), digital marketing and OTT (Mocha, Keng), customer care (MyViettel, Viettel ++), e-government, and SmartCity.

The message “Make in Vietnam” initiated by the Ministry of Information and Technology (MIC) has created vitality in the startup community. Vietnam has become the fifth country in the world mastering 5G technology, producing 5G infrastructure equipment and 5G smartphones. This stems from Make in Vietnam pride.

Over 13,000 digital technology firms were established just in the last year, raising the total number of digital technology firms to 58,000. The figure proves that the Make in Vietnam slogan has been realized in real life.

Adding high value

Nguyen Minh Quy, CEO of Novaon, commented that if Vietnam continues to do outsourcing, it will only be a very small part of the value chain.

Vietnam is among the top countries in the region and the world in some fields, such as telecommunications and power. In the last 20 years, Vietnam has been among the countries maintaining high growth rates.

An iPhone model can sell for $1,000, but the highest value belongs to the first links of the chain (learning about customers’ demands, research, product design) and the final links (distribution and marketing). A very small value is allocated to production.

At the closing of the national forum on digital technology firm development, Minister of Information and Communications Nguyen Manh Hung spoke about a noteworthy matter. Only 5-6 developing countries become developed after every so-called ‘revolution’. The 4.0 industrial revolution brings opportunities only to some countries. Vietnam and developed countries are at the same starting line.

“Mobile Money started in Kenya, a poor country in Africa. Poverty motivated advancement. Vietnam needs to lead in the 4.0 industry revolution. If Vietnam pioneers in applying 4.0 technology, the world will come here and Vietnam’s products will reach out all over the globe,” Hung said.

“Becoming a pioneer is always the aspiration of the Vietnamese nation and every Vietnamese citizen. It is difficult to implement this, but it is not impossible,” he said.

“Vietnam is behind many countries and it once missed a lot of opportunities on the development path, but this doesn’t mean that we will continue to endure and accept a low position,” he said.

Vietnam is among the top countries in the region and the world in some fields, such as telecommunications and power. In the last 20 years, Vietnam has been among the countries maintaining high growth rates.

And now, Vietnam has more motivating power from the 4.0 industrial revolution, from Make in Vietnam and digital transformation. So, Vietnam’s growth engine will have an additional push to turn the aspiration of becoming a high-income country by 2045 into reality.

In order to accomplish that, the space for creativity must be expanded, while management thinking needs to be reformed, so that creativity is not hindered by rigid regulations and officials’ bureaucracy.

Le Xuan Sang, deputy head of the Vietnam Economics Institute, stressed that Vietnam needs to reform the way of thinking and the institutional regime with the aim of encouraging participation of non-state sectors in science and technology development and innovation.

The expert believes that information technology and digital transformation should be seen as an important push and pillar to support the recovery process, strengthen resilience, and improve growth quality.

Ha Duy