Special Mechanisms to Drive Science and Technology Advancement in Vietnam: Opportunities for Businesses and Investors

March 19, 2025 Posted by Vietnam Briefing Written by Giulia Interesse Reading Time: 5 minutes

Vietnam is introducing special mechanisms to drive innovation and digital transformation, creating new opportunities for businesses and investors through improved infrastructure, regulatory reforms, and talent attraction. These changes position Vietnam as a growing hub for technology and R&D, with significant growth potential in the coming years.

Vietnam is intensifying its efforts to foster science, technology, and digital transformation, with Prime Minister Pham Minh Chinh advocating for “special mechanisms” to dismantle institutional barriers and fuel innovation.

During the National Assembly’s 9th extraordinary session on February 15, 2025, policymakers discussed a Draft Resolution aimed at addressing the challenges hindering progress in these fields. The Prime Minister emphasized that systemic reforms are needed beyond implementing targeted policies to create new investment opportunities and enhance more business-friendly regulations.

For companies and investors exploring Vietnam’s technology ecosystem, these proposed mechanisms—such as enhanced infrastructure financing, streamlined commercialization processes, and stronger public-private partnerships—signal a shift toward a more dynamic and predictable regulatory environment. By reducing bureaucratic hurdles and offering new incentives for talent acquisition and research and development (R&D), Vietnam is positioning itself as a leading hub for innovation in the region.

Context: Vietnam’s Resolution 57-NQ/TW

Resolution 57-NQ/TW (hereinafter, the “resolution”), signed by General Secretary To Lam in December 2024, underscores Vietnam’s commitment to advancing science, technology, and digital transformation as fundamental drivers of socio-economic development. This policy framework identifies these sectors as pivotal to the country’s progress, aiming to ensure data security, enhance competitiveness, and guide Vietnam’s evolution in the digital age.

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The resolution sets ambitious targets, including achieving high-income status by 2045, with the digital economy contributing 50 percent of GDP and placing Vietnam among the top 30 nations in innovation. To achieve these objectives, Vietnam plans to focus on bolstering scientific research, technological innovation, and digital transformation, leveraging data as a core asset and prioritizing cybersecurity.

A central element of the resolution is the establishment of special mechanisms to attract high-quality talent and promote innovation. These mechanisms include the development of modern, secure digital infrastructure and revisions to legal frameworks that support science and technology. By fostering a collaborative and creative environment, Vietnam aims to eliminate institutional barriers and offer incentives for R&D, particularly in vital sectors.

The need for special mechanisms for science and technology advancement in Vietnam

Prime Minister Chinh has emphasized that institutional barriers must be removed to successfully implement the resolution, which outlines strategic breakthroughs in science, technology, and digital transformation. To address these issues, the government has introduced a draft resolution proposing pilot policies aimed at eliminating obstacles in these sectors. This includes revising key laws, such as the Law on State Budget, the Tax Law, the Enterprise Law, and the Law on Science and Technology (draft), with some amendments expected to be presented for National Assembly approval in May 2025.

The rationale behind these reforms is to overcome the institutional constraints that currently limit Vietnam’s ability to fully leverage its scientific and technological potential. By addressing these barriers, the government aims to create a more favorable environment for innovation and attract both local and foreign investment into the technology and science sectors.

PM Chinh has highlighted the importance of establishing special mechanisms that engage both the public and private sectors, facilitating the mobilization of resources for the development of infrastructure critical to supporting the nation’s digital transformation. Moreover, he emphasized the need for mechanisms that will improve the management of science and technology activities, particularly in attracting and retaining top talent. This includes strategies to draw professionals from beyond the state-owned sector, encourage private sector participation, and attract foreign experts to accelerate Vietnam’s innovation capabilities.

Through these reforms, the government aims to ensure that Vietnam not only removes the existing obstacles but also sets the stage for sustained growth in its tech and innovation ecosystem, ultimately contributing to the country’s long-term development goals.

Proposed special mechanisms

Emphasizing the urgent need for institutional reforms, PM Chinh reaffirmed the Government’s commitment to implementing Resolution 57 of the Politburo and ensuring its successful execution. In this context, the Prime Minister highlighted five critical special mechanisms that will help propel Vietnam’s science and technology landscape:

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Infrastructure development mechanism: A dedicated mechanism focused on building the necessary infrastructure for science, technology, innovation, and digital transformation. This will involve mobilizing resources through public-private partnerships, businesses, society, and individuals to overcome the current underdevelopment of these sectors. 
Management mechanism: A shift in management approaches where the State would invest in critical science and technology infrastructure, but allow private entities to manage the operations. This could involve a “public leadership-private governance” model, where the State sets policies and regulations, while enterprises take on the operational responsibilities. 
Support for scientists and commercialization mechanism: This mechanism seeks to streamline decision-making by decentralizing authority to local provinces, ministries, and relevant stakeholders. It aims to eliminate bureaucratic inefficiencies and improve the commercialization process of scientific research, fostering greater innovation and efficiency in the sector. 
Protection for policy implementers: A crucial measure to encourage proactive implementation of policies by extending immunity to those responsible for carrying them out. This would reduce hesitation and fear of accountability, ensuring that implementers are protected from risks and can focus on the successful execution of science and technology policies. 
Talent attraction mechanism: To attract top-tier talent to Vietnam, this mechanism includes policies designed to create a conducive environment for scientists and researchers. This could involve incentives for private sector science and technology enterprises, as well as efforts to draw international experts by facilitating visas, housing, and other necessary conditions for foreign professionals.

PM Chinh further emphasized that driving breakthroughs in science and technology involves accepting risks, setbacks, and failures as valuable lessons that contribute to the nation’s long-term growth and resilience. By adopting these special mechanisms, Vietnam aims to create a more favorable environment for innovation, positioning itself as a regional leader in science and technology advancement.

Why businesses and investors should care?

Vietnam’s push to accelerate science, technology, and digital transformation through special mechanisms presents significant opportunities for businesses and investors. With the government committed to dismantling institutional barriers and creating a more innovation-friendly environment, this shift could reshape the landscape for technology-focused companies and entrepreneurs.

First, the establishment of special mechanisms, such as enhanced infrastructure financing, streamlined commercialization processes, and robust public-private partnerships, promises to lower the barriers for businesses looking to operate in the country. By improving the regulatory framework and reducing bureaucratic inefficiencies, Vietnam is positioning itself as an increasingly attractive destination for investment in technology and innovation-driven sectors.

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For investors, these reforms open up new avenues for growth, especially in high-tech fields. The government’s emphasis on creating a business-friendly environment through revised legal frameworks—such as changes to the Tax Law and Enterprise Law—will ensure that businesses have the necessary legal and financial support to thrive. These adjustments could reduce costs, enhance operational efficiency, and provide greater clarity for companies navigating the market.

Moreover, the focus on attracting high-quality talent and fostering innovation creates opportunities for businesses to access a skilled workforce and collaborate with top scientists, researchers, and entrepreneurs. This talent pool, bolstered by mechanisms to attract foreign experts and private sector professionals, could be a critical factor in scaling operations and driving long-term innovation.

Takeaway

Vietnam’s ambitious goals, including the transformation of the digital economy into a major contributor to GDP by 2045, signal that the country is focused on becoming a leader in the global innovation space. Vietnam’s evolving ecosystem offers significant growth potential for companies and investors with a keen eye on emerging markets, especially as the nation seeks to integrate cutting-edge technologies and digital advancements.

Businesses and investors should pay close attention to Vietnam’s special mechanisms because they represent a strategic shift toward an environment that supports innovation, attracts global talent, and facilitates investment in high-growth sectors. These developments are likely to unlock new opportunities, making Vietnam an increasingly appealing destination for those seeking to capitalize on the growth of science, technology, and digital transformation in the region.

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