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Vietnam way to technological innovation

Written by John Guzman

The era of disruptive technology completely changed the way of doing business around the world. Innovation became a necessity for survival but it comes at a price. Human resources are the center of technological innovation. Reviewing programs Vietnam has taken would offer a glimpse on how far the country has gone in pursuing technological innovation.

The Vietnamese government, in particular Ho Chi Minh’s local government, is proactive in developing hi-tech industry in the country. Saigon High-Tech Park (SHTP) is evidence of the industry’s role in the economy. Production revenues have amounted to more than USD 6 billion, and have created more than 17,000 jobs since 2002, according to VietnamPlus. In addition to SHTP, Vietnam also develops centralized Information Technology (IT) zones to focus on training the next breed of software developers.

At present, there are three operational centralized IT zones strategically located all over the country: Cau Giay IT Park in Hanoi located in the north, Vietnam-Da Nang Software Park located in the central part of Vietnam, and Quang Trung Software City (QTSC) located in Ho Chi Minh City in the south. In January of this year, a government decree went into effect to promote doing business inside these IT zones. Under the decree, companies inside IT zones will receive preferential tax, investment credit, and customs procedures. QTSC recently announced that it will work to complete its technical infrastructure and service system before the end of the year in a bid to attract more investors. QTSC employs more than 17,000 people, while total revenue of companies in QTSC alone reached USD 130 million last year, a year-on-year increase of more than 20 percent, according to a report of Vietnam News. The report mentioned strategy plans to maximize benefits from the said IT zones.

The significant number of employees in the high-tech industry reflects its importance to the country’s economy. Parks also serve as training centers for the employees, which would further enhance the quality of Vietnam’s workforce and the government is aware of it. On October of this year, Vie-Pan Techno Park will open its doors to high-tech companies specifically targeting Japanese companies.

Ho Chi Minh city’s local government is even expanding its capability to develop agricultural technology by building agricultural hi-tech parks. The need to produce more food is more important than before as people face the effects of climate change in coming decades. Cu Chi agricultural hi-tech park, the first of its kind, was established in 2010. The city recently announced its plan to build three more agricultural hi-tech parks, according to Vietnamnet.

Heavily relying on foreign investment to develop the high-tech industry is not without setbacks. Vietnam also needs to develop its own talent by investing on local developers by funding their research and initiatives. The country needs to compete with monetary benefits foreign companies could offer and that may cost significantly but developing human resources is never cost-free. Otherwise, developers honed by foreign companies would have a higher tendency to seek better opportunities abroad and would do no good to the efforts already made.

The benefits from developing hi-tech industry in Vietnam are not limited to short-term gains in the form of producing revenues and employing thousands of workers, where the real benefit would lie in developing and training Vietnamese. The hi-tech parks, which also serve as training centers are vital to the future of Vietnam in inventing disruptive technology.

–Edited by Mohamed P.Hassan

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