The race to break through in the digital age.

As the world enters a new growth cycle after the pandemic, innovation and digital transformation are becoming key drivers of the global economy.

The logos of OpenAI and ChatGPT are displayed on a screen in Toulouse, France. (Illustrative photo: AFP/VNA)

As traditional development models gradually reveal their limitations, many countries have proactively shifted direction, actively leveraging technology to reshape their economies , enhance productivity, and improve competitiveness. From developed economies like the United States and the European Union (EU) to developing countries in Asia and Latin America, the wave of digitalization and innovation is creating profound changes in development strategies.

The role of innovation

The power of innovation and digital technology is increasingly spreading globally. They help businesses operate much more efficiently. Tools like artificial intelligence (AI), the Internet of Things (IoT), and big data automate tasks, optimize production and business processes, and significantly reduce costs, thereby increasing labor productivity in all sectors. Furthermore, technology creates entirely new economic playing fields, such as giant e-commerce platforms, convenient financial services on smart devices (Fintech), and the sharing economy model (like ride-hailing or home rentals via apps). This fosters the emergence of novel and more flexible business practices.

At the national level, being at the forefront of technology and innovation provides a significant competitive advantage. Countries that are quick to adopt technology attract more investment, talent, and create higher-value products and services in the international market. However, the impact and approach to digital transformation differ across regions. Developing countries see this as an opportunity to "leapfrog," skipping costly intermediate stages of technological development. Nevertheless, they also face challenges such as underdeveloped network infrastructure, a shortage of skilled technology personnel, and disparities in access to digital technology. Meanwhile, for developed economies, this is the "key" to maintaining their leading position. Their goal is to continuously improve existing industries, create new high-tech industries, and address the challenges of a developed society.

The Organization for Economic Cooperation and Development (OECD) emphasizes that investment in digital technology and innovation capacity is key to maintaining sustainable economic growth. Meanwhile, the World Bank recommends that developing countries leverage digital transformation to expand access to services, finance, and education , thereby creating new added value.

Looking internationally

Recognizing this enormous potential, many countries have developed concrete action plans. Singapore is a prime example, with its ambition to become a "Smart Nation." They invest heavily in network infrastructure, encourage data usage, and integrate technology into every aspect of life. The Singaporean government provides a very favorable environment for technology startups to thrive through financial support policies and business incubators. As a result, Singapore has become a leading technology hub in Southeast Asia, attracting numerous international technology corporations.

In the United States, the driving force behind innovation stems from massive investment in research and development (R&D), both from the government and private corporations. A system of prestigious universities closely linked to businesses, along with abundant venture capital, has created fertile ground for the birth and growth of leading global technology companies. The CHIPS and Science Act, passed by the administration of former President Joe Biden in 2022, with a total funding of over $280 billion, is a prime example. Furthermore, the private sector in the US – including major technology corporations such as Google, Meta, Amazon, and Microsoft – plays a central role in creating this robust innovation ecosystem.

However, a Visual Capitalist report indicates that, in 2023, US R&D investment (3.4% of GDP) still needs to increase to compete with countries like South Korea (5% of GDP). South Korea is a model for integrating AI and IoT into high-tech zones such as the Pangyo Technology Park. The South Korean government is heavily investing in its national AI strategy, aiming to bring AI into every sector from manufacturing and healthcare to transportation.

Meanwhile, the EU views digital transformation as a crucial pillar for building a green economy and strategic self-reliance. The "Digital Europe" program and the EU NextGeneration Recovery Fund have allocated tens of billions of euros to invest in digital infrastructure, data, cybersecurity, and digital skills for workers. The EU's goal is that by 2030, 75% of businesses will use cloud computing and big data, and 80% of adults will possess basic digital skills.

Even in emerging economies, impressive initiatives are emerging. The Porto Digital technology center in Brazil is a prime example. From an old neighborhood, it has become one of Brazil's largest technology parks, attracting numerous IT and innovation companies thanks to effective public-private partnerships and attractive policies to attract talent. The Brazilian government is promoting the replication of this model to bring technology closer to traditional sectors such as agriculture, education, and construction.

It's no longer a trend.

Innovation and digital transformation are no longer just trends, but the most important growth drivers of the 21st century. The success of leading nations shows that a clear strategy, persistent investment in technology and human resources, and the creation of a favorable environment for innovation are decisive factors.

Technology and innovation are becoming strategic pillars for countries to enhance productivity, achieve sustainable development, and strengthen their competitive position. However, in many countries, legal institutions have not kept pace with the speed of technological development, creating difficulties for startups. Furthermore, large digital platforms like Facebook and TikTok dominate the market, making it difficult for local businesses to compete. Therefore, countries need to build long-term strategies, reform institutions, and cooperate internationally to transform challenges into opportunities to thrive in the global economy.

For Vietnam and other developing countries, learning from international experience while building strategies tailored to specific conditions is crucial to avoid missing the "train" of the Fourth Industrial Revolution, moving towards a rapidly developing, sustainable, and inclusive economy.

According to VNA

Source: https://doanhnghiepvn.vn/cong-nghe/cuoc-dua-de-but-pha-trong-ky-nguyen-so/20250501083523498