Vietnam is rapidly developing the IT industry
With the rapid spread of the Internet in Vietnam, the IT industry has maintained stable high growth rates, and this is one of the areas with large sales and exports. According to VINASA (Vietnam Association of IT Services and Software), as shown in Figure 1, sales in the IT industry in general continue to rise, indicating that the market is growing rapidly. Vietnam’s economic growth rate is about 6% per year, but the IT industry is developing at a much faster rate.
The IT industry can be broadly classified into the hardware industry, the software industry and the digital content industry, but the hardware industry supports the rapid development of the IT industry. About 90% of sales in 2016 was the hardware industry. The Government of Vietnam promotes the development and development of IT staff and the IT industry is an important foundation for economic and social development.
Figure 1
Development of communication infrastructure and IT infrastructure
The Vietnamese government has been making efforts to improve the telecommunications environment since the 2000s and has been actively promoting the development of IT infrastructure. Based on the 2018 report of IWS (Internet World State), I want to consider the communication environment in Vietnam compared to other major countries in Asia. First of all, the Internet populations of major Asian countries (Figure 2), China, India and Indonesia, have large, highly ranked populations, while Vietnam ranks sixth in the region. Moreover, looking at Internet penetration rates in the region (Figure 3), Vietnam has a higher penetration rate than China and India, and in ASEAN countries, the penetration rate is only behind Singapore and Thailand. and Malaysia. This shows that Vietnam’s domestic communication infrastructure is more advanced than other countries. The reason behind this is the result of the Vietnamese government’s focus on information and communication technology development since 2000 and the promotion of active investment in IT infrastructure. If you look at the growth of the Internet population from 2000 to 2018 (Figure 4), you can understand the remarkable growth of AVietnam at a glance.
Figure 2
The spread of the Internet in Japan has led to an increase in penetration rates of mobile phones and smartphones. According to the Ministry of Information and Communications of Vietnam, by the end of 2016, domestic mobile phone users accounted for 94% of the population and Internet users via smartphones accounted for 72% of the population.
In particular, the rapid penetration rate of LTE (4G) communication is very noticeable. The LTE communication trade service in Vietnam was finally started in 2016, which is the slowest of the Southeast Asian countries. However, according to VINASA, in about a year and a half after the official launch of LTE service, LTE connection will reach 95% of Vietnam’s population and can see its rapid spread.
The hardware industry is the cornerstone of the IT industry
In 2017, there were about 3,500 companies participating in the hardware industry in Vietnam and it contributed significantly to the development of the IT industry with revenue of more than 60 billion USD, equivalent to about 90% of the entire IT industry. It has attracted $ 1 billion in major investment projects from major IT companies across the globe. The main case is the following three.
Samsung Group has eight factories and a research center in Vietnam, with a total investment of more than US $ 17.3 billion and the number of employees in Vietnam reaching 170,000.
Similarly, LG Electronics in Korea invested about US $ 1.5 billion in building a mobile phone manufacturing and assembly plant in Hai Phong, Vietnam.
-Intel, an IC chip factory for laptops and other mobile communication devices in Ho Chi Minh City Hi-tech Park (SHTP), has invested US $ 1.04 billion and Intel CPU is currently Produced worldwide. About 80% are IC chips from the same factory.
The software industry is supported by cheap and skilled IT staff
Software development is one of the fastest growing areas for foreign investment in Vietnam. In 2017, the software and digital content industry generated about 3 billion dollars, IT services generated about 6 billion and software exports reached more than 1 billion dollars. In particular, offshore development has become popular in recent years, with a focus on cheap and high-tech labor of IT human resources in Vietnam.
In addition, Vietnam’s software industry has become famous in recent years and internationally. A national assessment report is consistent with the development of BPO (Business Process Outsourcing) by AT Kearney, a consulting firm published in 2017, according to India, China, Malaysia, Indonesia, Brazil and Vietnam out of 55 countries. Voted for the sixth position, this led to a five-position increase from 2016. In addition, according to the report of the leading US company, Gartner, who researches and advises on the IT field, “Assess outsourcing of IT services in Asia – Pacific,” Vietnam is a public transfer company
