The Republic of Korea (RoK)’s National IT Industry Promotion Agency (NIPA) has launched a centre for Vietnam-Korea IT cooperation in Ho Chi Minh City.
The first such centre was launched two years ago in Hanoi, Vietnam, which proved successful, but as the Vietnam economy grows, a second centre was needed, this time based in Ho Chi Minh City.
Channel Asia understands that both these centres will act as local hubs, boosting cooperation and investment between Vietnamese and RoK firms in the IT sector.
It is also understood the centres will conduct ICT cooperation programmes, in particular for businesses investing in six key areas, namely, e-government, smart training, smart city, smart healthcare, smart business and smart traffic.
Furthermore, the RoK Government will develop special assistance programmes to contribute to the development of Vietnam’s IT industry and the building of the startup environment in the ICT sector.
The country has enjoyed increased inward investment in recent years, with some analysts predicting Vietnam to overtake Singapore in the next 5 years as the region’s most likely candidate to be the next ‘Silicon Valley,’ given the growing number of tech firms operating in the country.
For one, its ‘Make in Vietnam’ campaign has proved very successful, modelled after the ‘Make in India’ campaign launched by Indian Prime Minister Narendra Modi in 2014.
For the Vietnam, the initiative has attracted approximately US$230 billion worth of committed investments.
Furthermore, according to the Ministry of Information and Communication (MIC), in 2018, Vietnam’s IT industry had a turnover of US$98.9 billion, a growth rate of eight per cent over the year before.
To break this down, electronics brought US$88 billion and software US$4.3 billion, IT service US$5.7 billion and digital content service US$800 million.
A report from Oxford Economics showed that FDI in the manufacturing sector in Vietnam, bolstered by electronics production, has grown by 11 percent per annum in the last five years.
The Vietnam government’s ambition is to shift from an outsourcing model to one that embraces research and development, putting the country on the map for intellectual property, where new technologies and products are invented and created in Vietnam, rather than just manufactured.
Vietnam still has a lot to do to realise this vision. However, with large organisations such as Viettel and Vingroup beginning to make heavy investments in technology, Vietnam as the region’s new ‘Silicon Valley’ may come sooner than expected.