The Industry 4.0 potential for export growth

Businesses should increase investment in science and technology to enhance their competitiveness

Great advances expected

MSc Tran Viet Hoa, Deputy Director of the Ministry of Industry and Trade’s Science and Technology Department, said Industry 4.0 has become a global trend based on the strong development of digital technology, physics, biology, and highly-integrated applications, such as automation and 3D printing technologies, smart robots, artificial intelligence, and connection technology.

Prime Ministerial Instruction 16/CT-TTg dated May 4, 2017 on enhancing the capability for access to Industry 4.0 indicates that Vietnam is in the process of industrialization, modernization and international integration. Therefore, Industry 4.0 opens opportunities for Vietnamese businesses to improve their technological level, manufacturing capability and competitiveness, creating start-up opportunities and facilitating business access to advanced technologies.

Economists believe Industry 4.0 will generate high pressure on Vietnamese businesses to improve technology and build smart industrial manufacturing facilities that work with support of automation technology to create products of higher quality and competitiveness, enable quicker delivery and attract more orders.

Vietnam has advantages in exporting industrial products, such as textiles and garments, leather, footwear and electronic components. However, the added value of Vietnamese exports is not high due to low intellectual content and a lack of creativity. Industry 4.0 will push these sectors to increase investment in applying advanced technologies to improve quality and productivity.

Catching up

Industry 4.0 is opening big opportunities for Vietnam to boost industrial production and exports. However, Instruction 16/CT-TTg indicates that if it does not strive to catch up with the development of the region and the world, Vietnam will face challenges and adverse impacts, such as technological backwardness, production and business declines, and the redundancy of low-skilled workers that would break the traditional labor market.

To make the most of opportunities presented by Industry 4.0 and minimize its adverse impacts, the prime minister asked ministries, sectors and localities to concentrate on the following measures from now until 2020:

- Boosting the development of information and communications technology infrastructure, applications and human resources; developing digital infrastructure and ensuring network security, facilitating the access to digital content development opportunities for people and businesses.

- Promoting the implementation of prime ministerial resolutions 19-2017/NQ-CP and 35/NQ-CP regarding measures to improve the business environment, boost business development, and facilitate the comprehension and development of new manufacturing technologies.

- Proposing major plans and tasks to get ready for Industry 4.0; giving priority to developing digital tech industries, smart agriculture, tourism, and smart cities; identifying key competitive products to develop.

- Promoting the national start-up ecology by putting in place appropriate policies and mechanisms to facilitate business startups; encouraging businesses to invest in scientific research and technology development; connecting communities of overseas Vietnamese whose jobs are in the field of science and technology with those in the country.

- Changing education and vocational training methods to create human resources capable of using new manufacturing technologies, focusing on training in science and technology.

- Enhancing the awareness of state authorities at different levels, as well as of businesses and people, of Industry 4.0’s potential.

The PM’s directive is expected to help ministries, sectors, localities and businesses understand the opportunities and challenges that Industry 4.0 offers so that they can take suitable measures to boost industrial production and exports. Along with the government’s efforts, businesses need to improve their manufacturing technologies to increase productivity and enhance product quality.