Vietnam's World-Class Education System Fuels Economic Growth in 2024

Vietnam's education system drives its economic growth, attracting high-tech FDI and digital cooperation with Russia, positioning the country as a global economic powerhouse.

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Ayesha Mumtaz
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Vietnam's World-Class Education System Fuels Economic Growth in 2024

Vietnam's World-Class Education System Fuels Economic Growth in 2024

Vietnam's education system, ranked among the world's best, continues to be a driving force behind the country's economic growth in 2024. Despite having a significantly lower GDP per capita of $3,760 compared to countries like Malaysia, Thailand, Britain, and Canada, Vietnamese students are outperforming their peers in international assessments of reading, math, and science. This remarkable achievement highlights the strength and effectiveness of Vietnam's education system in nurturing and developing its human capital, which is a key driver of the country's economic progress.

Vietnam's focus on preparing clean land funds through infrastructure development in industrial parks, training high-quality human resources, developing new electricity sources and logistic services, and improving the business climate has been instrumental in attracting high-tech foreign direct investment (FDI) capital. The shift in global production chains, especially in core technology and future technology industries, is opening up many opportunities for Vietnam. The fourth FDI wave to Vietnam is expected to bring investment from the United States and Europe, with a focus on high technology and new technology, and a rejection of projects with outdated technology, environmental risks, or labor-intensive industries.

Why this matters: Vietnam's success in education and its ability to attract high-tech FDI demonstrate the country's potential to become a major player in the global economy. As the world shifts towards a knowledge-based economy, Vietnam's investment in human capital and its focus on technology-driven industries position the country for sustained economic growth and development.

Vietnam's digital economy has also experienced remarkable development, with the proportion of the digital economy in Vietnam's GDP reaching 16.5% in 2023 and an average annual growth rate of 20%, three times the GDP growth rate. Vietnamese digital technology companies have been strengthening their international cooperation efforts, with revenue from foreign markets totaling an estimated $7.5 billion in 2022, up 4% year-on-year. The current context presents tremendous opportunities for digital economic cooperation between Vietnam and Russia, particularly in areas such as cybersecurity, smart cities, digital banking, and digital business solutions.

Delegates at a seminar on Vietnam-Russia digital economic cooperation emphasized the importance of Russia's experiences in developing its digital ruble, which could be a significant driver for economic cooperation between the two countries in the coming time. Vietnam is concentrating on improving its competitiveness by building an appropriate investment incentive policy framework, particularly in light of the global minimum tax regime that came into effect on January 1, 2024.

Key Takeaways

  • Vietnam's education system ranks among the world's best, driving economic growth.
  • Vietnam attracts high-tech FDI through infrastructure, human capital, and business climate.
  • Vietnam's digital economy grew 20% annually, 3x GDP, with $7.5B in foreign revenue.
  • Vietnam-Russia digital cooperation opportunities in cybersecurity, smart cities, and banking.
  • Vietnam focuses on competitiveness through investment incentives amid global minimum tax.