AI Economy as New Growth Pillar

After nearly four decades of Doi Moi (renovation), Vietnam’s traditional growth drivers are gradually becoming less effective, creating an urgent need to shift its development model. As the global economy moves toward knowledge, technology, and data, artificial intelligence (AI) is emerging as a new pillar with important implications for national competitiveness.

Pressure to transform the growth model

Vietnam’s economic achievements from 1986 to 2025 are undeniable. According to data from the National Statistics Office (NSO) and the World Bank, Vietnam’s GDP in 2025 is estimated at around US$514 billion, placing the country among the fastest-growing economies in the region. However, behind this strong growth are underlying structural challenges.

Speaking at the Vietnam Economic Forum 2026, recently held in Hanoi by the Institute of Vietnam and World Economy under the Vietnam Academy of Social Sciences (VASS), experts said the main issue is the gap between the quality and scale of growth. For many years, economic expansion has depended largely on capital investment and labor advantages, while contributions from innovation and technology have remained limited. As a result, labor productivity, a key driver of long-term growth, remains low compared with many countries in the region.

In this context, Nguyen Duc Hien, Vice Chairman of the Party Central Committee’s Commission for Policies and Strategies, said that building a new development model based on science and technology, innovation, and digital transformation is strategically important. In his view, this is not simply a policy adjustment but a fundamental shift that begins with the “development philosophy.” This creates a clear difference between the traditional growth model and development in the digital era.

From a structural perspective, heavy reliance on the FDI sector remains a concern. Dr. Tran Thi Van Hoa of the National Economics University said that FDI accounts for more than 70% of export turnover, showing that domestic enterprises have yet to move deeply into higher value-added segments. As global supply chains fluctuate, the economy becomes more vulnerable.

Resource-use efficiency also remains a bottleneck. A persistently high Incremental Capital-Output Ratio (ICOR) means more capital is needed to generate each unit of growth, reflecting low investment efficiency. This creates pressure to shift from extensive growth to a model driven by efficiency and innovation.

At the same time, advances in digital technology, particularly AI and automation, are reshaping global production structures. Labor-intensive industries, once a key advantage for Vietnam, are gradually losing their edge. Meanwhile, new standards for green growth, digitalization, and sustainability are reshaping global trade and investment flows.

These factors point to dual pressure on Vietnam’s growth model, requiring both the resolution of internal bottlenecks and adaptation to rapid external changes. As traditional drivers weaken, identifying a new growth axis based on technology, data, and innovation becomes essential to sustain momentum in the coming period.

Data economy and AI as the new growth axis

As traditional drivers weaken, the data economy and AI are not just alternatives but are becoming the main axis for restructuring the entire economy. According to the McKinsey Global Institute, AI could contribute up to US$13 trillion to the global economy by 2030, while the digital economy is projected to exceed 20% of global GDP. Future value creation will mainly come from data, algorithms, and information-processing capabilities rather than capital and labor.

Nguyen Trung Chinh, Chairman of CMC Corporation, said that data has become the new “production infrastructure” of the economy, as AI is applied across sectors from manufacturing and finance to healthcare and logistics. This wide application gives AI the role of a “strategic infrastructure,” similar to electricity or the internet in earlier stages of development, positioning the AI economy as a pillar of future growth.

At a deeper level, AI’s impact on the economy can be seen across three layers. However, turning this potential into real momentum requires addressing several core issues at the same time. Huynh Quyet Thang, President of Hanoi University of Science and Technology, said that science and technology, innovation, and digital transformation must be placed at the center of the development model rather than treated as supporting factors.

More importantly, the AI economy cannot develop without a coherent ecosystem. This includes large-scale data infrastructure, a legal framework for data sharing and use, and a highly skilled workforce.

As global competition intensifies, the advantage will go to countries that not only apply but also master AI technologies. The shift to an AI-driven economy is therefore not simply about keeping up with trends, but an opportunity for Vietnam to reposition itself in global value chains, moving from processing to value creation. If used effectively, AI will not only support growth but also become a new pillar shaping the country’s development model in the years ahead.

By Giang Tu, Vietnam Business Forum