E-commerce promoted to boost Vietnam's digital economy

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Vietnam has recently released a national plan on e-commerce development in the 2021-2025 period.

The national plan on e-commerce development in the 2021-2025 period is integrated with current Vietnamese strategies and policies on participating in the Fourth Industrial Revolution toward developing a digital economy and promoting national digital transformation.

Its overall goals include promoting the application of e-commerce in businesses and the community, narrowing the gap between major cities and localities to promote online trading, building a sustainable virtual market, boosting production and consumption of Vietnamese goods, and increasing cross-border online trade.

Vietnam expects online shoppers to account for 55% of the population by 2025, with average spending projected to hit US$600 million a year.

It forecasts revenue from e-commerce in the buyer-to-customer (B2C) model to surmount US$35 billion, or 10% of retail sales and services nationwide, thus raising the use of cashless payment 50%.

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Nguyen Binh Minh of the Executive Committee of Vietnam E-Commerce Association said, “COVID-19 is a test for the entire world to restructure its economy. In the pandemic, e-commerce has proved its high stability in a crisis. Nobody can say exactly when COVID-19 will end. For the time being, e-commerce is a good solution and will continue to be in the future. Promoting e-commerce as the core in the national economic development will no longer be a direction, but the right solution.”

Under the plan, the Ministry of Industry and Trade proposed six ways to develop e-commerce in Vietnam including fine-tuning policies and mechanisms; improving management capacity; fighting trade frauds, infringement of intellectual property rights and unfair competition in the online environment; strengthening domestic consumer confidence, and promoting cross-border online trade.

Dang Hoang Hai, Director General of the Ministry of Industry and Trade’s Department of E-commerce and Digital Economy, said: “We have to develop e-commerce nationwide instead of only in big cities. Second, it’s necessary to apply new technologies to better manage product quality and reduce costs for e-commerce. The third is to develop Vietnamese goods.”

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“These will be the foundation for making full use of e-commerce to bring benefits to people in remote areas, create healthy competition among Vietnamese manufacturers, and drive the national economic development. To help e-commerce develop more comprehensively, we will revise the decree on e-commerce and work with other ministries and sector to promulgate strict punishments to prevent violations of goods quality,” Hai added.

Once the master plan is put into practice, Vietnam’s e-commerce will likely move up to second place in Southeast Asia and become the most potential market in the region by 2025.

Economist Nguyen Tri Hieu said, “I totally agree with the master plan because, in fact, e-commerce is an inevitable trend. It has been widespread in developed countries. To achieve this goal, the government and functional agencies need to speed up the cashless payment system. We also need to change consumers’ shopping habits by enhancing trust-building activities for customers.”

Consumption habits have changed significantly due to the COVID-19 epidemic. Consumers now prefer online shopping to traditional shopping methods. Many individuals and businesses are turning to online channels to promote their products and trade.

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