Vietnam’s digital transformation has witnessed remarkable progress in recent years, as reflected in the increasingly comprehensive legal framework, expanded digital infrastructure, and the widespread application of technology across various sectors. However, despite these achievements, the digital transformation process continues to face significant obstacles that must be acknowledged and addressed in a timely manner.
Key Achievements
From a policy and institutional standpoint, the government has issued the National Digital Transformation Program to 2025, with orientation toward 2030, under Decision No. 749/QĐ-TTg, clearly defining three strategic pillars: Digital Government, Digital Economy, and Digital Society. This program serves as a crucial compass for Vietnam’s comprehensive, profound, and sustainable digital transformation. In line with this directive, ministries, central agencies, and 63 provincial and municipal governments have developed and implemented their own digital transformation plans, ensuring consistency while adapting to local realities.
Vietnam has made notable gains in global digital transformation rankings. According to the United Nations, in 2024, the country improved its position in the E-Government Development Index (EGDI) by 15 places, ranking 71st out of 193 countries—demonstrating efforts to enhance digital public services and governance. The Global Innovation Index (GII) published by the World Intellectual Property Organization (WIPO) also saw Vietnam climb two positions to 44th out of 133 countries, reflecting improved innovation capacity. In cybersecurity, Vietnam rose eight places to 17th out of 194 countries in the Global Cybersecurity Index (GCI), as reported by the International Telecommunication Union (ITU), underlining the country’s growing commitment to safeguarding its digital space (Minh Hoang, 2025).
Digital infrastructure has seen significant improvements. By the end of 2024, over 82.4% of households were using fiber-optic internet, surpassing the 2025 target. The commercialization of 5G by major carriers such as Viettel and VNPT has boosted connection speeds and created favorable conditions for advanced technologies like the Internet of Things (IoT), Artificial Intelligence (AI), and Big Data. The shutdown of 2G networks further reflects Vietnam’s commitment to transitioning toward a next-generation, efficient, and modern connectivity ecosystem.
In the public sector, the establishment of the national population database has yielded clear benefits, with over 1.3 billion data queries and 537 million synchronization instances across 18 ministries and all 63 localities. The VNeID digital ID application is increasingly used for public services, healthcare, education, and banking. As of late 2024, 45.79% of full-process public services were available online, moving toward the goal of 80% by 2025.
In the digital economy, Vietnamese enterprises—especially startups and large corporations—have actively adopted platforms such as ERP, CRM, e-commerce, and cashless payments to improve governance and scale. The Ministry of Information and Communications has developed a local-level digital economy measurement toolkit, enabling provinces and cities to identify strengths and weaknesses and tailor development roadmaps accordingly. According to the 2024 e-Conomy SEA report, Vietnam’s digital economy was valued at approximately USD 30 billion, ranking second in Southeast Asia.
On the societal front, with over 87% smartphone penetration and widespread access to high-speed internet, Vietnam has laid the groundwork for digital society development. Citizens are increasingly familiar with online learning, telemedicine, digital banking, and e-wallets, which help improve quality of life, reduce costs, and promote equitable access to public services.
Challenges and Limitations
Despite this progress, Vietnam’s digital transformation still faces notable institutional, infrastructural, technological, human resource, and societal challenges. Left unaddressed, these limitations may hinder the speed, quality, and sustainability of the country’s digital advancement.
First, the legal and institutional framework for digital transformation remains incomplete and fragmented. Although the government has issued key documents—such as Decision No. 749/QĐ-TTg and the National Data Strategy—regulations concerning personal data protection, cybersecurity, digital identity, and data sharing between systems remain inconsistent. Many agencies still struggle with implementing technical standards, creating difficulties in data integration. According to Pham Thi Giang (2024), the delay in establishing a coherent legal framework has weakened the functionality of national information systems and caused data-sharing bottlenecks between ministries and provinces.
Second, there is a significant digital infrastructure gap between regions, particularly between urban and rural areas, and between lowland and mountainous zones. While major cities like Hanoi, Ho Chi Minh City, and Da Nang have invested heavily in 5G, data centers, cloud computing, and digital platforms, many remote provinces still suffer from unstable internet connectivity, outdated telecom infrastructure, and a lack of end-user devices. The Ministry of Information and Communications (2024) reported that while 82.4% of households have fiber-optic access, disparities remain, with some border communes still lacking sufficient mobile coverage. This severely limits access to digital services—especially e-government, remote education, and telehealth—in rural areas.
Third, the digital workforce remains insufficient in both quantity and quality. Digital transformation demands not only IT engineers but also a general workforce with basic digital skills. However, multiple studies indicate that Vietnam’s proportion of workers with foundational digital literacy is still below the regional average. High-demand specialists in AI, cybersecurity, Big Data, and systems programming remain scarce. Although universities and colleges have introduced digital technology-related programs, curricula often lag market demands, lack practical training, and are slow to adapt—leading to shortages in both the public and private sectors.
Fourth, digital awareness and mindset remain limited among businesses and the general public. A significant number of small and medium-sized enterprises (SMEs) still perceive digital transformation as a costly expense rather than a strategic investment. According to Bui Anh Tuan (2025), the proportion of businesses with formal digital transformation strategies remains low. Key barriers include lack of information, financial constraints, and insufficient skilled personnel. Fear of change and perceived risks associated with new technologies also prevent many firms from embracing the digital economy.
Fifth, disparities in technological access among population groups risk deepening the digital divide. Older adults, low-income households, ethnic minorities, and residents of remote areas face greater difficulties accessing and using digital services due to lack of devices, skills, and technical support. Without timely and inclusive policies, digital exclusion could worsen existing social inequalities.
Strategic Directions for Vietnam’s Digital Transformation
To promote comprehensive and sustainable digital transformation, Vietnam must implement a cohesive strategy based on long-term vision—placing citizens and businesses at the center, technology as the driving force, and institutions as the foundation.
First, the legal and regulatory framework must be completed. Accelerating the adoption of laws and guidelines such as the Personal Data Protection Law, the amended Law on Electronic Transactions, and regulations on digital identity, data sharing, and cybersecurity is imperative. National technical standards for digital platforms must be developed to ensure system compatibility and integration.
Second, modern and synchronized digital infrastructure must be expanded. Investments in broadband networks, fiber-optic transmission, 4G expansion, and nationwide 5G commercialization—especially in rural, mountainous, and island regions—are critical. Domestic data center development should be encouraged to ensure data sovereignty and national cyber resilience. The VNeID platform should be widely adopted across healthcare, education, banking, and public services.
Third, digital workforce development must be prioritized. This includes structured digital literacy education from primary to tertiary levels and specialized training in AI, Big Data, cybersecurity, and blockchain. Collaboration between government, businesses, and educational institutions is needed to form a flexible, responsive digital talent ecosystem.
Fourth, digital transformation among businesses, particularly SMEs, must be supported. Programs providing low-cost digital platforms, tailored consulting, and incentives for e-commerce, cashless payments, ERP, and CRM adoption should be expanded through tax, credit, and training support mechanisms.
Fifth, public digital awareness and digital literacy must be improved. Nationwide media campaigns should highlight the benefits of digital transformation and help rural and underserved populations engage with digital platforms. Initiatives such as “digital villages” and “digital communes” should be promoted to bridge regional gaps.
Sixth, Vietnam must enhance international cooperation and promote innovation in digital transformation. Active participation in global digital forums will allow the country to access new technologies and adopt best practices in digital governance. Policies should also aim to attract major domestic and international tech firms, particularly in strategic fields such as AI, semiconductors, and quantum computing.