Innovative Startups: The Need for Specialized Mechanisms and Policies

The socio-economic development strategy for the 2021 – 2030 period emphasizes that science – technology and innovation are essential strategic breakthroughs. On the sidelines of the event in response to World Creativity and Innovation Day – April 21 each year, organized by the Ministry of Science and Technology on April 19, Pham Hong Quat, Director of the Department of Market and Science and Technology Enterprise Development, discussed the development of the Vietnamese innovation and startup ecosystem in recent times, as well as the growth path for this field in the near future.

How do you assess the current state of development of the Vietnamese innovation and startup ecosystem? What are the challenges for startups, in your opinion?

Through the eyes of international experts, consultants and investors, Vietnam’s innovative startup ecosystem is considered an attractive destination for dynamic, creative young people who can quickly adapt to business models. Notably, after COVID-19, when countries are experiencing disruptions in supply chains related to capital provision and market development, Vietnam has maintained its connections; domestic and international entities can still connect with each other by quickly shifting activities offline to online. The recovery speed is very fast in smart agriculture models; services, training, and smart tourism. Vietnam continues to be an attractive destination for regional and international investors.

The biggest challenge for startups today, regionally and globally, after COVID-19, is the supply chain for technology, raw materials, output markets, and capital sources. Therefore, we must have creative solutions right from the institutional and policy levels. Currently, for Ho Chi Minh City, the National Assembly promulgated Resolution 98/2023/QH15 on June 24th, 2023, on the piloting of a number of specific mechanisms and policies to develop the City. It includes very important content on encouraging and calling on investors to support investment and innovation and startups, and offers numerous incentive policies for innovative businesses, as well as for experts and consultants. Da Nang is also proposing a similar mechanism. The Ministry of Science and Technology is also proposing to the Government a new decree on the policy to promote innovation and startups; in which mechanisms will be introduced to encourage intermediary organizations, localities, startup support centers, and innovation centers, in line with domestic demand and the international integration process.

In the startup process, Vietnam has seen the emergence of 4 technology unicorns (VNG, VNLIFE, MOMO, SKY MAVIS). With the current policies promoting startups, what are your expectations for the emergence of new technology unicorns in the coming time?

Having multiple technology unicorns is a common goal for all national ecosystems in the region as well as for the rest of the world. Countries are also fiercely competing to attract and retain talent. Vietnam has the potential for a high-quality workforce. These are Vietnamese people within the country, Vietnamese people working for large corporations abroad, as well as multinational corporations currently present in Vietnam. We expect not only the quantity of unicorns but also the extent to which Vietnam masters new technologies and models.

The growth potential of an entire ecosystem needs to move in a more sustainable direction. Unicorns can emerge at this time, in this country or that, when there are temporarily attractive policies on tax and investment. However, for a whole ecosystem to flourish, the previous generation must support the next, the training base must be linked to the private sector, and tied to the Government’s development policy. This requires a sustainable, long-term development process.

We hope to set many targets, right from the grassroots level, students at the secondary education level will learn about STEM and will be exposed to new models. From there, Vietnam will have sustainable technology unicorns in the future. The approach to the ecosystem needs to be people-centric and people-driven.

To develop the ecosystem, we must experiment with policies. Accordingly, policy experimentation must have proactive cities leading the way before being expanded nationwide. Currently, a number of cities in Vietnam are actively proposing mechanisms for policy experimentation. For policies testing specific technologies, ministries, industries, and corporations will be the first destinations for new technologies and business models to enter the testing process.

Starting from local values is currently a new direction for young people. How do you assess this direction?

Starting from local values such as cultural, historical, and human values has always been a very important source of inspiration for all countries as well as for the comprehensive innovation process. Innovation based on local resources is a very “hot” and topical topic. This is also a theme that TechFest 2024 is working towards. We are inviting international organizations such as UNDP, ADB, and green growth funds to participate.

Currently, the Vietnam Women’s Union, the Ho Chi Minh Communist Youth Union, the Farmers’ Association, and the Cooperative Union have all committed to supporting this theme. These actions are important starting points for us to renew added values based on technology, based on new business models that exploit the resources and inherent strengths of each locality.

In 2024, this will be the 10th year that the Innovation and Startup Day has been organized by the Ministry of Science and Technology. What are the highlights of TechFest 2024?

TechFest is the largest annual event for the Vietnamese startup community, organized under the direction of the Ministry of Science and Technology and a number of central ministries, industries, and socio-political organizations. The event aims to raise awareness of the role of innovation, contributing to sustainable socio-economic development; encouraging the community to join hands to promote startup activities.

The theme of TechFest each year is closely associated with issues that need to be addressed in the startup ecosystem, attracting the attention and cooperation of the community in finding effective and timely solutions. TechFest 2024 is expected to be held in late November – early December 2024 in Hai Phong to summarize activities, showcase outstanding technologies, and business models of the startup ecosystem in 2024, as well as throughout TechFest’s 10-year journey since 2015.

Hai Phong is a dynamic city with many projects on the development of semiconductor technology, green growth technology, and blue sea technology. I hope this will be an attractive destination for startups, experts, and technology consultants in Vietnam and around the world this year.

The theme of TechFest 2024 emphasizes the integration of the Vietnamese startup ecosystem with the region and the world, especially in the following topics: Creating social impact, green growth, and sustainable development; establishing a platform for a startup network; emphasizing new technologies and high technologies associated with green transition, circular economy, digital transformation, and comprehensive innovation, leaving no one behind.

It is expected that nearly 150 activities will be organized from now until the time of the national TechFest with the participation of nearly 30 technology villages.

Within the framework of the national TechFest, it is expected that a High-level Tech Startup and Unicorn Summit will be held with the participation of high-tech startup enterprises, unicorn startup enterprises, and potential unicorns (soonicorns) in Asia. In addition, there will be an International Conference on Building an Innovation and Startup Ecosystem with the participation of important state management agencies, socio-political organizations from the central to local levels, and international organizations such as UNDP, ADB, USAID, WB…

Thank you so much