Turning Pressure into Propulsion
According to Dr. James Kang, since the US announced its plan to impose tariffs on several trading partners, including Vietnam, the country’s technology industry has been facing its biggest challenge yet. For a nation that is gradually solidifying its position in electronics and semiconductors, this sudden surge in costs is a significant shock.
However, amidst this turmoil, many domestic technology firms are swiftly adapting by pivoting towards smart technologies, investing in software and digital services, and exploring new markets beyond traditional channels to survive and mitigate negative impacts.
Dr. Kang shares that, for years, Vietnam has benefited from global trade fluctuations, especially the tensions between the US and China. But this time, Vietnam itself is under pressure. The new tariffs make exported products from Vietnam, such as phones and semiconductor chips, including Intel’s, less competitive in the US—one of the largest markets.
Nonetheless, this challenge could be a turning point. Instead of waiting for the wind to change, many Vietnamese businesses have taken proactive measures. Vietnam is committed to tightly controlling the origin of its goods. This strategic move is aimed at reducing trade tensions and demonstrating goodwill towards the Trump administration’s policies.
Vietnam is Gradually Moving Away from its “Low-Cost Manufacturing Hub” Status
As labor costs rise and the trading environment becomes more unpredictable, Vietnamese technology companies are embracing artificial intelligence (AI) and automation.
These are not just trendy technologies but practical solutions. The leading technology group FPT has invested $174 million in building an AI center and is pouring an additional $200 million into a high-tech production facility. Their focus includes software development, cybersecurity, and next-generation AI creation.
While not every business has similar resources, this trend is spreading: leveraging smart technologies to cut costs, increase productivity, and maintain flexibility in an ever-changing world.
Vietnam was once known for its cheap labor and efficient assembly lines. But that is changing. More and more companies are adopting smart manufacturing models, applying automation with technologies like robotics, IoT sensors, and data analytics to produce faster and with greater accuracy.
Some companies even offer digital transformation services to help other businesses modernize their operations. With tools like IoT, factories can monitor energy consumption, detect faults in real time, and control machinery remotely. These technologies are helping Vietnam climb the global value chain.
However, as Dr. Kang points out, transformation naturally comes with challenges. Businesses need to invest in workforce training, technology upgrades, and mindset shifts. For many companies, this is the only choice to move forward. Vietnam’s next tech frontier lies in digital services. Products like cloud computing, Software as a Service (SaaS), and mobile applications are unaffected by tariffs, unlike physical goods.
VNG Corporation is a prime example. Originally known as a mobile gaming and application company, VNG now specializes in providing global cloud services. Trading in digital products has helped this enterprise overcome tariff barriers, expand internationally, and reduce dependence on any single market.
“This shift reflects a larger trend of Vietnam gradually moving away from its ‘low-cost manufacturing hub’ status and evolving into a creative and digital force on the global stage, while lower-value manufacturing industries are gradually moving to other developing countries like Sri Lanka,” Dr. Kang observes.
Dr. James Kang, Senior Lecturer in Computer Science, School of Science, Engineering and Technology, RMIT University Vietnam
Decoupling from the US Market and Looking to the Future
With trade relations with the US becoming increasingly volatile, Vietnam is exploring new export avenues. Agreements like CPTPP, EVFTA, and RCEP have opened doors to markets such as Japan, Canada, the European Union, and neighboring countries in the Asian region. These deals help Vietnam diversify risks and avoid over-dependence on a single market.
For technology firms, this means greater stability and opportunities for sustainable growth. Along with trade diversification, the government and private sector are driving deeper innovation. Initiatives like the 2025 International Conference on Artificial Intelligence and Semiconductors (AISC 2025) aim to accelerate research in AI and semiconductor technology—two key pillars for Vietnam to maintain its competitiveness.
The transition from low-margin manufacturing to high-value design and innovation is no easy feat. It demands time, talent, and capital. Nevertheless, aspirations are high, and so is the influx of investments.
Vietnam’s technological landscape is at a pivotal juncture, and bold strokes are needed to illuminate the bigger picture. Businesses must transcend basic production models and invest in smarter tools like AI and automation. However, they cannot do it alone. The government plays a crucial role in facilitating access to capital and supporting research initiatives to help local enterprises scale up. Educational institutions must equip young people with digital skills to prepare them for the jobs of the future.
For investors, the message is clear: Vietnamese startups and digital services have genuine global potential. However, this momentum cannot be interrupted. Rapidly rising wages could cause Vietnam to lose its competitive edge in low-cost labor.
Meanwhile, Vietnam has yet to establish itself in high-tech sectors, leaving the economy vulnerable. Overdependence on a large market like the US further increases the risk of being affected by external fluctuations. As regional peers accelerate, Vietnam must also expedite its transformation to maintain its competitive edge.
Fortunately, Vietnam doesn’t start from scratch. Successful models from around the world offer valuable lessons. South Korea built a robust technology economy by investing in innovation. India made its global mark by exporting digital services. Singapore became a global tech hub through strategic planning and persistent investment.
“Vietnam can draw insights from these models. By strengthening its intrinsic capabilities, adopting smart tools, and pursuing a clear strategy, Vietnam has the opportunity to shape its future and lead the region in the next wave of technology growth,” suggests Dr. Kang.
Clearer Criteria Needed to Distinguish Between Three Types of Digital Assets: Virtual, Crypto, and Other Digital Possessions.
“During the afternoon session on May 9, discussions on the draft Law on Digital Technology Industry, pertaining to regulations on digital assets, took place. National Assembly Deputy Dong Ngoc Ba proposed a clearer distinction between three groups of digital assets: virtual assets, encrypted assets, and other digital assets.”
The Evolution of Vietnam’s E-commerce Landscape: An “Ever-changing, Ever-challenging” Narrative
Users today can view products on TikTok, order on Shopee, lodge complaints via Facebook, and return items in-store. This paints a picture of diverse, ever-evolving, and challenging consumer behavior.
“MB Securities is Hiring: 1,000 Brokers Wanted. Attractive 100% Commission-Based Remuneration.”
The Vietnamese stock market is on the cusp of a significant enhancement in liquidity and performance. With the Ministry of Finance and the State Securities Commission’s announcement of implementing solutions to achieve the market upgrade goal by 2025, it presents a pivotal moment for the industry. This has spurred securities companies to adopt unprecedented business strategies to seize the opportunity, accelerate growth, and attain a leading position in the market.
The Future is Fidovn: Expanding Horizons, Elevating Visions
On February 28, 2025, at the iconic Landmark 81, Fidovn debuted in Vietnam with a bang. The event marked a significant step in the company’s expansion strategy, as they proudly announced partnerships with over ten leading real estate companies. With this move, Fidovn solidifies its position in the market and showcases its commitment to growth and innovation in the industry.
The Power of the Five Elements: FPT’s Abundant Qi in 2023, as Foretold by Truong Gia Binh
According to Truong Gia Binh, FPT now has all the necessary elements for success: timing, location, and talented people. The company is poised to make significant strides and achieve new breakthroughs.
