Vietnamese digital enterprises and the journey to the world

DNHN - Vietnam is a country with a strong rise in technology, and many Vietnamese digital enterprises are pioneering in expanding to the global market and achieving great success.

1,500 digital enterprises generate revenue from overseas markets

According to statistics, as of the end of July 2024, the total number of active digital enterprises is estimated at around 51,038, an increase of nearly 6,000 businesses compared to August 2023. Notably, there are now 1,500 digital enterprises generating revenue from overseas markets.

The revenue from overseas markets in 2023 was 7.5 billion USD, and this year, the figure is expected to be approximately 10 billion USD, reflecting a growth rate of about 30%.

At the conference "Vietnamese Digital Enterprises Going Global: Opportunities and Challenges" held in the morning on October 17, Mr. Nguyễn Thanh Tuyên, Deputy Director of the Information Technology and Communications Industry Department, Ministry of Information and Communications, provided an overview of the IT sector and opportunities for IT enterprises in Vietnam.

He stated: "FDI investment in the technology and information sector has been growing at a compound annual growth rate of 15.4% from 2020 to 2023, but its proportion remains small. Through Vietnam's attractive investment policies, investment in the technology sector has been rapidly growing. However, the proportion of this sector is still very small, indicating that Vietnam still has room to continue to develop and attract foreign investors in the near future."

According to Mr. Tuyên, Vietnam currently has about 1.5 million workers, including nearly 500,000 engineers. In terms of the structure of the IT industry in Vietnam in 2023, about 63% of enterprises are involved in hardware and electronics, 17% in software, 14% in IT trading and distribution, and 8% in IT services excluding trading and distribution.

Currently, about 70% of universities and colleges in Vietnam are training in IT-related fields, showing Vietnam's effort to expand the IT workforce supply. Additionally, IT training universities and colleges have also added new specializations to align with global technology trends such as AI and cybersecurity. This helps to increase both the quality and supply of skilled IT professionals in the market.

Vietnamese enterprises making their mark on the international market

At the conference, Mr. Vũ Văn Chung, Deputy Director of the Foreign Investment Agency, Ministry of Planning and Investment, stated: "Across the country, there are 1,772 overseas investment projects with a total registered capital of 22.12 billion USD, investing in 81 countries and territories. Besides traditional investment destinations, overseas investment is gradually shifting to developed countries such as the United States, EU, Japan, South Korea, Singapore... Apart from traditional sectors, there is a significant increase in investment in high-tech sectors, services, industrial production, and industries with modern technological content."

In particular, regarding overseas investment in the information and communications sector, Vietnam currently has 223 foreign investment projects in this field, with a total registered capital of 2.84 billion USD, accounting for 13% of total overseas investment. These projects mainly focus on markets like Singapore, Japan, South Korea, and the US. In terms of project scale, telecom projects are larger, concentrated in Myanmar, Peru, and some African countries, while smaller-scale IT projects focus on Singapore, the US, and Japan.

In recent years, Vietnamese digital enterprises have developed rapidly, both in number and competitive capability. The Vietnamese tech business community has been providing digital products, services, and solutions to accelerate digital transformation, economic development, and social digitization of the country, helping to bridge the digital gap globally, and cooperating with the international business community to build a digital world.

In 2022, FPT marked its position on the global tech map by becoming the first Vietnamese company to launch an integrated circuit chip for Internet of Things (IoT) products for the medical field.

In 2023, FPT's chip products began to make an appearance in markets like the US and Japan. Additionally, FPT expanded into other fields such as lighting, smart devices, automotive technology, and energy... 2022 was the first year FPT reached 1 billion USD in revenue from the international market in digital transformation, placing Vietnam second on the digital map, behind software powerhouse India.

Meanwhile, Viettel, the Military Telecommunications Group, also had a successful 2022 on the international market, with revenue reaching nearly 3 billion USD. Viettel remains the number one 5G network provider in markets like Laos, Cambodia, Myanmar, Timor-Leste, and Burundi. Furthermore, Viettel is a standout Vietnamese enterprise in digital transformation efforts for countries like Haiti, Laos...

Additionally, many businesses are investing in the research and development of new technologies such as semiconductor chips, Generative AI, and Blockchain... These businesses are present in over 20 countries, employing tens of thousands of personnel, driving digital transformation for companies on the Fortune 500 list and leading global corporations.

Speaking to the Business and Integration Magazine, Mr. Nguyễn Thanh Tuyên added: "Digital technology can be seen as an important launchpad for enterprises when entering the global market. While large enterprises have already made successful strides in conquering the international market, the IT field presents a bright opportunity for small and medium-sized enterprises as well. To make a mark on the international stage, the most important thing for SMEs is to have big ambitions, and secondly, to have unique products to bring to the international market."

"Supporting factors" helping Vietnamese digital enterprises expand overseas

With the perspective of "The State paves the way, the first to go pull the rest along", the Ministry of Information, in particular, and the government in general, have been providing support to encourage Vietnamese digital enterprises to expand globally.

According to Mr. Nguyễn Thanh Tuyên, the Ministry of Information and Communications is currently drafting the Digital Technology Industry Law. This draft is expected to promote the development of the digital technology industry, turning it into a sector that significantly contributes to the national economy; positioning Vietnam as the most favorable environment for nurturing and developing digital technology enterprises. Furthermore, the draft is also expected to advance the development of the digital technology industry with a focus on Vietnamese digital enterprises and contribute to building a digital government, driving economic and social digitalization. The draft also aims to promote the smartification of industries by embedding digital technology into various sectors, changing work methods, bringing new values, and creating a revolution in smartization.

In addition to the Digital Technology Industry Law draft, Mr. Tuyên also mentioned various financial sources for developing the digital technology industry, including: state budget; National Science and Technology Development Fund; Science and Technology Development Fund and other lawful capital sources of enterprises; Local and enterprise development funds; National Technology Innovation Fund, high-tech venture capital funds, and other funds in the field of science and technology; Universal Telecommunication Service Fund; ...

"Additionally, the government has provided certain support for innovative startup activities. Specifically, there are funding programs, loans, and financial assistance; for the digital tech startup ecosystem, there are incubators, startup centers, technology transfer hubs...; competitions, programs supporting digital tech startups, communications, trade promotion... to encourage digital tech innovation startups", Mr. Tuyên stated.

To further enhance opportunities, space, and scope for digital enterprises to invest abroad, at the conference, speakers emphasized the need to continue to strengthen international cooperation to improve digital transformation capacity and e-commerce through signing more memoranda of understanding with trade promotion organizations and major global partners. Leveraging international resources to support experience sharing and capacity building in digital transformation and e-commerce for IT enterprises.

The conference is expected to help Vietnamese digital enterprises better understand the opportunities and challenges of conquering new markets and expanding their development space. Ministries and sectors are committed to continuing to promote economic diplomacy and trade promotion to help Vietnamese digital enterprises access foreign markets, seek partners; analyze market potential, and promptly resolve difficulties and obstacles to help businesses mitigate risks when investing and doing business abroad.

Mr. Hà Thế Dương, Deputy CEO of Viettel Global, shared some experiences when investing abroad: Firstly, strict adherence to legal regulations and commitments with the governments of both Vietnam and the host countries, along with strict monitoring, is a key factor in ensuring the quality and success of overseas investment projects. Secondly, building good relationships with host countries. Fostering good relations with local management agencies also contributes to supporting investors during business operations. Thirdly, for Viettel Global, "leaders on the frontier" is not an unfamiliar phrase. The Group's management and Viettel Global’s board not only guide and manage but also work closely with local teams. Fourthly, Viettel Global holds the top market share in 7 out of 10 markets, most of which achieved breakthroughs by finding opportunities in challenges. Fifthly, Viettel Global considers exchange rate differences as business costs, adjusting prices smartly to compensate for increased costs due to exchange rate fluctuations. Sixthly, in other countries, they established the Association of Vietnamese Investors to help and support each other in their journey of overseas investment.

In addition, in response to a question from the Business and Integration Magazine, Mr. Duong also shared that data security is an important factor when businesses participate in international markets. He stated: "According to the regulations in the host country, we are using servers in that region, and personal data cannot be transferred outside the country where we are operating. Each category of data has specific regulations regarding whether it can be transferred or not. Domestically, we also have critical data categories and allocate the data categories reasonably."

Bao Bao