Vietnam in Top 10 Emerging Markets for Global Data Centers
Vietnam is among the top ten emerging markets in the global data centre market according to a leading research agency. It noted that Vietnam has remarkable growth, international standard service delivery capacity, and a large number of organisations and enterprises.
The Vietnamese data centre market stood at US$858 million last year and is forecast to grow at a compounded annual growth rate of over 14.64% until 2026. The growth in the Vietnamese data centre market was driven by government projects and initiatives, as per a news report.
Data protection is a matter of global concern and is becoming an important issue on the agenda of the Vietnamese government. The data localisation requirement under the Cybersecurity Law, plus the need for better processing speeds to assist Vietnamese users are the main drivers, which are anticipated to significantly enhance the demand for data centres in the country.
The Vietnamese government’s inclination toward digitisation has further bolstered the demand for data centres across the country. Furthermore, the Vietnamese data centre market is driven by the shifting of enterprise data to cloud platforms. This has led to an increase in the adoption of data storage solutions, which, in turn, is expected to positively influence the growth of the market. Additionally, the growing adoption of digital technologies, big data solutions, the Internet of Things (IoT), and cloud-based solutions among others, is expected to propel market growth through 2026.
The digital economy in Vietnam accounts for about 8.2% of GDP. The potential for development for the Internet and digital economy components is large. The ICT digital economy accounts for about 4.5% of global GDP, about 6.9% of America’s GDP, and 7% of China’s GDP. For Vietnam, the ICT digital economy is estimated to account for about 5.5% of the country’s GDP, with a revenue of about US$123 billion.
However, the government has claimed that this number does not reflect the real potential of Vietnam’s Internet digital economy, because many cross-border digital platforms collect billions of dollars in Vietnam but do not make declarations. The supervision and management of online business forms have many loopholes. Measuring the digital economy is still difficult, but this figure shows that Vietnam’s Internet digital economy still has great potential for development. According to a recent report, although Vietnam’s internet economy is behind Indonesia and Thailand in total revenue, Vietnam has the highest growth rate with 16% per year, compared to 11%/year for Indonesia and 7%/year for Thailand.
To boost growth, ministries, sectors, and localities can immediately implement tasks to promote the digital economy. They can implement training programmes, universalise digital skills for people and businesses, and at the same time build a network of consultants for digital transformation and the digital economy in their industries and localities.
Apart from growing the ICT market, the country also aims to be an innovation and AI hub in ASEAN and the world. As OpenGov Asia recently reported, the government issued a national strategy on the research, development, and application of artificial intelligence (AI) with a vision till 2030. By then, Vietnam aims to have set up 50 interconnected open databases in economic sectors. To achieve this, the country is fine-tuning legal documents, creating a legal framework regarding AI, and promoting international cooperation in the field.