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Oct 31, 2023 / 05:54

Vietnam's economic growth hinges on five sectors: NIC and Golden Gate Ventures report

These five sectors will together create an innovative ecosystem consistent with the ambition to become a developed country by 2050 and Vietnam’s global innovation needs.

MedTech, fintech, EdTech, logistics support technology, and green economy are the five main sectors predicted to dominate Vietnam's economic growth in the future. 

 Delegates attend the summit. Photo: Thuy Dung

The forecast was highlighted in Vietnam: A Global Engine of Growth, released by the National Innovation Center (NIC) and Golden Gate Ventures at the Vietnam Venture Summit 2023 on October 30 at the NIC Hoa Lac facility.

The report provides information on Vietnam's ability to cope with economic challenges and examines the potential factors in Vietnam's growth process in the coming years. Some highlights on the macroeconomic overview, business environments, and investment opportunities in Vietnam are tech-enabled sectors, modern business-to-business services, and green-focused initiatives are among the most potential verticals for future growth.

 

However, to ensure success, it is imperative to conduct a comprehensive evaluation of the market entry strategy and the ability to thrive, taking into account the various economic, legal, operational and environmental challenges that may arise, according to the report.

The forecast is based on statistical data showing that per capita healthcare expenditure in Vietnam has tripled in the past five years.

The value of transactions in the fintech sector is predicted to achieve a compound annual growth rate of 15% over the next four years to meet the financial needs of 70% of Vietnamese people who are currently not utilizing banking services.

The report points out that logistics support technology and small-scale business models also play crucial roles. Regarding the green economy, Vietnam is leading the development of clean energy in Southeast Asia with innovations in wind and solar energy. The EdTech sector is evaluated to have natural growth momentum and is increasingly attracting foreign investment into the Vietnamese market.

"These five sectors will together create an innovative ecosystem consistent with the ambition to become a developed country by 2050, as well as Vietnam's global innovation needs," forecasted NIC and Golden Gate Ventures in their report.

At the forum, Vinnie Lauria, Co-founder of Golden Gate Ventures, assessed that, in a challenging year for most economies, Vietnam has shifted its economic development to high speed and affirmed itself as the new economic growth center of Asia.

"With a strong position in the global supply chain and continuous investment from multinational corporations, the innovative startup ecosystem is thriving, nurturing Vietnam's desire to change the world," he emphasized.

 Deputy Minister of Planning and Investment Tran Duy Dong speaks at the event. Photo: MPI

The forum aims to connect international and regional investment funds with Vietnam's innovative startup ecosystem, while also creating a mechanism for policy dialogue to promote and enhance the effectiveness of investment activities for innovation and creativity, Deputy Minister of Planning and Investment Tran Duy Dong underlined. 

Dong further stated that this is the fourth consecutive year the ministry has collaborated with Golden Gate Ventures to organize the event. The forum is also a place for investment funds to demonstrate their commitment to investing in startups and innovation in Vietnam. 

In the previous forums in 2019, 2020, and 2022, the number of participating funds and committed capital has continuously increased, from 18 funds with $425 million in 2019 to 33 funds with $815 million in 2020, and 39 funds with $1.5 billion in 2022.

In the first half of this year, the total investment capital in the technology sector in Vietnam ranked third in Southeast Asia, with a total investment of $413 million.

A recent report highlighted that Vietnam's startup ecosystem has risen from the fifth to the third position among the top six economies in Southeast Asia, as evidenced by the investment capital ratio in the innovative startup market as well as the number of active investors and investment funds in Vietnam, the deputy minister noted.