Online payments are made on telephone (Photo: Vietnamplus) Hanoi (VNA) – Vietnam is ranked 63rd out of 113 global economies in a global ranking of digital environment and support systems for entrepreneurs, according to a new index developed by the Asian Development Bank (ADB).
Released earlier this week as part of the Asian Development Outlook (ADO) 2022, the Global Index of Digital Entrepreneurship Systems (GIDES) puts Singapore in in the top spot, followed by the United States and Sweden.
However, according to the ADB, 17 of the 21 developing Asian economies are at the bottom of the list, underscoring the need for many of them to encourage digital start-ups.
Digitisation presents huge growth opportunities for businesses in Asia and the Pacific. It is the motivation for innovation and a key to economies striving for high incomes. Digitization can also make economies more resilient, as digital technology has helped many businesses survive the COVID-19 pandemic and can spur global growth by reducing start-up costs.
“Digital entrepreneurship helped economies stay afloat during the COVID-19 pandemic, and it can become a major engine of growth and innovation in the post-pandemic world,” said ADB Chief Economist Albert Park.
“For this to happen, there needs to be a supportive environment enabled by conducive policies and incentives. While the environment for Asia’s digital entrepreneurs made substantial strides in the past couple of years, there’s still a lot of room for improvement.”
The index measures the quality of the environment for digital entrepreneurs by looking at the level of digitalisation in eight areas, namely culture, institutions, market conditions, infrastructure, human capital, knowledge, finance, and networking.
In addition to investing in digital infrastructure such as broadband networks, governments need to promote political stability, reliable legal systems, open and competitive markets, and strong property rights.
For Asia and the Pacific as a whole, an insufficiently supportive culture is among the biggest weak spots when it comes to nurturing digital entrepreneurship. One example is a general lack of public appreciation for the vital role that entrepreneurs play in economic progress. One way to change this is to improve the public perception of entrepreneurship through education.
Developing sustainable tourism from connecting arts with digital technology (Photo: Vietnamplus). Earlier, the ADB released the “Vietnam’s ecosystem for technology startups” report, assessing the state of tech startups in Vietnam with a focus on the ecosystem. It examines the extent to which the system supports the growing number of startups in the country. The report focuses on two sectors: agritech and healthtech. While fintech and e-commerce startups are the most prevalent in Vietnam and other countries, these two sectors were chosen because startups in these sectors not only become successful businesses, but also have a strong impact on development.
According to the report, Vietnam is creating the necessary conditions to build its next generation of tech unicorns. It said that Asia-Pacific’s next tech unicorns may well come from Vietnam. The Vietnamese Government’s long-term goal in this regard is to attract knowledge, organisations, individuals, and entrepreneurs to contribute to economic development and participate in the creation of startups.
One example of government assistance is the “Supporting the national innovation startup ecosystem to 2025” project (Project 844), approved by the Prime Minister in Decision No. 844/QD-TTg. This project sets a goal of developing 600 startups by 2025, 100 of which will have capital of at least 2 trillion VND (85.5 million USD).
According to Aimee Hampel-Milagrosa, an economist in the Economic Research and Regional Cooperation Department at the ADB, the Vietnamese Government recognizes that tech startups are a new engine of growth for the country.
In 2021, the top five startup sectors in capital attraction were financial technology (fintech), with 26.6%, e-commerce, with 20.3%, education technology (edtech), with 17.2%, healthtech, with 7.8%, and service software, with 6.3%.
In order to facilitate growth, the Government has begun to assemble key elements such as financial and policy incentives to create and build the next generation of “unicorns”. Universities and research institutes in the country are also coordinating with provincial governments and central ministries and sectors to establish startup support units./.
