Hanoi ready to lead Vietnam’s digital transformation with bold, strategic reforms

THE HANOI TIMES — Hanoi aims to raise the digital economy’s share of its GRDP from 16.25% in 2024 to 30% by 2030 and 40% by 2045.

Dr. Nguyen Minh Phong, former Head of the Economic Research Department at the Hanoi Institute for Socio-Economic Development Studies, spoke with Hanoimoi Newspaper about the city’s progress, challenges and the key steps needed to achieve these ambitious goals.

How do you assess Hanoi’s digital economy development in recent years?

Hanoi ranks among the top three localities in digital transformation, information technology, innovation and cybersecurity.

The city has launched Plan No. 57/KH-UBND on digital transformation and smart city development in 2024, focusing on four pillars: the information and communication technology (ICT) industry, digitalization of economic sectors, digital governance and digital data.

The digital economy now contributes about 16.3% of Hanoi’s GRDP. Core databases on population, enterprises and insurance have been widely used. Cashless payments, e-invoicing and e-commerce are growing rapidly across the city.

Hanoi has nearly 10,000 information, technology and electronics companies, generating $12.8 billion in total revenue and employing more than 207,000 workers.

Many firms have developed core technologies and created about 40 “Make in Vietnam” digital platforms, including Viettel Solutions, CMC Technology and Solutions Corporation, VNPT Hanoi, and Phenikaa Maas Technology.

The city’s digital economy has advanced strongly in digital enterprises, online public services and e-commerce. Online retail now accounts for nearly 13% of total retail sales, double the figure in 2020. However, these achievements still fall short of Hanoi’s full potential.

What are the main bottlenecks hindering Hanoi’s digital economy from making a breakthrough?

There are three main bottlenecks.

First, digital transformation levels differ widely among sectors. The public sector and large firms have progressed quickly, while many small and medium-sized enterprises (SMEs) lag behind.

According to the Hanoi SME Association, about 35.8% of businesses adopted some digital tools but later stopped using them. Another 39.5% have digitized data and processes but have not restructured their business models.

Second, data infrastructure and cybersecurity remain weak. The city has built a Public Administration Service Center, upgraded about 1,200 online public services and linked them to the National Public Service Portal. But data systems across departments are still fragmented and unconnected.

Without shared and integrated big data, analysis, forecasting, policymaking and service development remain limited.

Third, some agencies and companies still view digital transformation as “digitizing paperwork”. In fact, its essence is to redesign operations based on data and technology. Without a change in mindset, Hanoi cannot achieve real breakthroughs or added value.

Hanoi targets the digital economy to make up 30% of the city’s economy by 2030 and over 40% by 2045. What pillars should the city focus on to achieve this goal?

The Prime Minister expects that Hanoi will lead in building a digital economy, a digital society and digital citizenship toward a modern and civilized capital.

The city should expand 5G coverage and extend fiber-optic networks to all households and businesses. It is building an international-standard data center to support smart urban management, data-driven growth and stronger digital governance.

Hanoi has more than 1,000 startups, accounting for 26% of Vietnam’s total, and two-thirds of the country’s top research institutions and scientists. The city should continue improving its institutional framework, support innovation-based enterprises, promote international cooperation, attract high-tech investment and build regional innovation hubs.

Human resources remain key. Hanoi must train workers at all levels in digital skills. Leading universities such as Hanoi University of Science and Technology, National Economics University and FPT University have opened programs in data science, artificial intelligence and blockchain, which will help form a skilled digital workforce.

Hanoi should also bring digital transformation to rural areas. Models like digital communes, digital cooperatives and digital craft villages can help rural communities join digital value chains.

Selling One Commune One Product (OCOP) goods on e-commerce platforms will expand market access, raise value for agricultural products, narrow the gap between urban and rural areas and create an inclusive digital Hanoi.

What specific policies has Hanoi introduced to support enterprises, startups and research organizations in innovation?

The city has introduced several key policies to speed up digital transformation.

These include Plan No. 57/KH-UBND (February 8, 2024) on digital transformation and smart city development, Plan No. 259/KH-UBND (August 29, 2024) on addressing shortcomings to meet transformation goals and Decision No. 6785/QD-UB (December 31, 2024) outlining major breakthrough tasks for 2025.

Six resolutions adopted at the special session of the Hanoi People’s Council to implement the 2024 Capital Law provide a strong legal foundation to mobilize resources for science, technology, innovation and digital transformation.

Hanoi allocates at least 3% of its budget to these areas, the highest proportion in the country, showing its firm commitment to science and technology.

The city is building a dynamic innovation and startup ecosystem with over 1,000 startups, accounting for 26% of the national total.

Innovation centers and incubators at Hoa Lac Hi-Tech Park, Vietnam National University, Viettel, CMC and VNPT are creating close cooperation among government agencies, enterprises, research institutes and investors, promoting innovation and technology transfer across the capital.

As the country’s political and economic center, what do you expect from Hanoi’s leadership role in Vietnam’s digital economy?

Hanoi should act as a national model. The city has the infrastructure, skilled workforce and innovative environment to become a digital innovation hub in Southeast Asia.

If Hanoi fully utilizes its potential, the digital economy can become a powerful growth engine, defining a new identity and brand for the capital in the digital era.

It will help strengthen Hanoi’s position, contribute to national progress and enhance Vietnam’s regional and global standing.

The key lies in “thinking right and acting fast,” with flexible policies and a long-term vision. Guided by the spirit “Hanoi for the country, together with the country,” the capital will continue leading the way toward a prosperous, modern and civilized Vietnam, fulfilling President Ho Chi Minh’s vision.

Thank you for your time!