Communist Review - The world is entering the “digital age” with unprecedented characteristics, nature and impact. Countries in international relations are also adjusting their policies and strategies to best suit digital transformation, including policies related to international integration. For Vietnam, getting the most out of the digital integration are at the core of successful inclusive and comprehensive implementation of international integration policies approved in the Document of the 13th National Congress. Therefore, it is necessary to study numerous intertwined opportunities and challenges and issues related to digital globalization worldwide, and thus request adequate policies for Vietnam.

The term “digital age” has been used by most international organizations and many countries around the world(1). The digital era is characterized by new features and impact at an unprecedented scale and magnitude. First, the driving force shaping the digital era is the global digital transformation in order to comprehensively change the development mode of society, lifestyle and activities on the digital platform. According to the United Nations, digital technologies are developing faster than any other invention in human history(2). Second, for the first time, a virtual space on the global scale is taking shape and closely intertwined with the physical space. It has strong connectivity, goes beyond national geography, and is less controlled by governments. The data created and stored by the world in the last five years is estimated to be larger than all the data humanity has created before. Third, the development and movement of the world as well as of every single country, business, and people in the coming decades or even in the next century are forecasted to be strongly influenced by the digital era. Areas affected include politics, security, economy, culture, society and so forth.

In this circumstance, countries around the world are actively implementing strategies and policies on globalization with the focus on promoting the digital economy and new-generation international trade agreements. The US is a leading country in investment in digital transformation and digital economy development. China set ambitious goal to become the world's leading power in high-tech industries. The “Made in China 2025” strategy aims at creating autonomy in technology and innovation. Most Southeast Asian countries have formulated their own national strategies for developing the digital economy, such as Brunei's “Wawasan Brunei 2035” strategy,  national goals for the digital era 2023 of Cambodia, plans and roadmaps for the development of digital infrastructure, e-commerce and digital enterprises of Indonesia as well as information technology vision 2030 of Laos, Malaysia's “Digital Malaysia” strategy, Myanmar's Digital Economy Development Committee's activities, the Philippines' national digital strategy, Singapore's plan to become a leading smart nation  in information and communication technology, Thailand's plan for digital economy and digital society development 2014 - 2034. At regional scale, digital integration is also step by step given due priority. In 2019, ASEAN issued a number of documents related to digital integration such as the Digital Integration Framework Action Plan for the period of 2019 - 2025 and the ASEAN Digital Integration Index (ADII) as proposed by Vietnam in 2020.

Opportunities and challenges during the process of digital integration

Opportunities

Firstly, digital globalization opens up opportunities for developed countries to make a breakthrough through early and successful implementation of digital transformation (legal institutions, infrastructure and digital human resources). The World Economic Forum (WEF) forecasts that the value brought by digital transformation from four sectors, including automotive, consumer goods, power generation and logistics will top $100 trillion by 2025(3). The impacts from digital transformation are many times greater than previous scientific and technological revolutions, that is why any country that promptly transforms will be able to make the leap and create breakthroughs. Estonia is a small country setting a successful example of leadership in digital transformation.

Secondly, it brings opportunities to attract resources for the development of infrastructure, digital technology and digital human resources skills as well as help countries become more self-reliant during their global integration. Total value of global investment for digital transformation in the period of 2020 - 2023 is predicted to reach $7.4 trillion(4). Developing countries have a great opportunity to go straight to modernizing IT infrastructure instead of investing in converting old infrastructure into new infrastructure like developed countries(5).

Thirdly, it supports countries scale up their space for development in the context that traditional trade and investment tend to slow down due to the impact of protectionism and the COVID-19 epidemic. In 2020, for the first time, agreements on the digital era were signed between Singapore, New Zealand and Chile (June 2020), Australia and Singapore (August 2020). The World Trade Organization (WTO) promotes cooperation on e-commerce. OECD accelerates tax negotiations in the digital age.

Fourthly, it allows to make better use of digital tools in foreign affairs to strengthen position and increase influence of countries. 98% of all the leaders and foreign ministers of the 193 UN member countries are now active on Twitter with 620 million followers(6). The COVID-19 epidemic has accelerated the use of digital tools in international relations, such as organizing virtual multilateral and bilateral conferences, communicating foreign diplomacy messages, building up the prestige, thus supporting effectively traditional channels.

Fifthly, it helps to improve national comprehensive power on the basis of factors mentioned above. The development and application of science and technology advances constitute a contributor to increase the “hard power” in economy and military, and also strengthen the “soft power” in terms of influence, international prestige, and attractiveness of growth model. Many experts believe that the increasing role of data and information will make “data centers” become the core focus of geo-politics, geo-economics in the world instead of regions or countries with the most traditional resources.

Challenges

First, in this increasingly digital era of globalization, countries run the risk of lagging further behind in economics. Developed countries with financial and technological potential will invest and deploy digital transformation strategy faster than other countries. Meanwhile, developing countries that are late involved in designing digital transformation and integration policies may face more difficulties in attracting resources. With the Fourth Industrial Revolution (Industry 4.0) that is being developed and implemented at an increasingly rapid pace, latecomers and laggards run the risk of lagging further behind.

Second, it increases challenge of national security and territorial sovereignty. Cybersecurity risks are increasing for countries. In fact, 2021 losses from cyberattacks represented more than 4% of global GDP(7). Threats to national defense and security have also risen due to the development of new generation weapons and eq­­­uipment integrated with digital technology, especially artificial intelligence (AI)... Furthermore, fake information campaign conducted by countries to interfere in other’ affaires increased the risk of social instability. The West, Russia and China are increasingly different in terms of promoting national sovereignty in cyberspace or maintaining a free and open cyberspace(8).

Third, it raises problems in governing private sector in cyberspace. The fact that a few large technology companies in the world hold a major role in infrastructure, digital platforms and data constitutes a high risk to the national security. Dealing with the relationship between government and large tech companies is a hard-solving problem, even for great powers like the US. Developing countries face numerous barriers in managing economic activities, especially cross-border digital services and platforms such as taxation, digital content control, and transnational human resources across cyberspace and so forth.

Fourth, it causes impacts made by escalating strategic competition between big countries in shaping the global "rules of the game", especially in digital space. Take an example of competition in finance and digital currencies which is likely to increase when some economies such as China, Japan, and the European Union (EU) prepare to issue digital money and consider it the sovereign digital currency.

There remain thus countless problems arising from digital globalization. Firstly, it is the response to instability caused by the disruption of balance of power in international relations through technologies, digital transformation, especially AI for non-transparent purposes. Delays and stoppages in digital transformation are likely to have significant consequences on the development and security of countries. Secondly, it is dealing with complex problems that arise from growing ideological antagonism. Some countries use new technologies, such as the internet of things, AI to interfere in the internal political affairs of other countries through disinformation campaign to provoke instability in cyberspace, data insecurity, loss of control over digital infrastructure, and interference in democratic elections. Thirdly, the requirements set out in building of the country's digital capacity (institutions, infrastructure, human resources) play a pivotal role in the process of digital transformation in particular and globalization in the digital age in general. Fourthly, it is imperative to narrow differences between countries in establishing a global multilateral governance framework in digital sector. It is likely that countries will promote bilateral and sub-multilateral cooperation, thereby forming a network of the multi-layered structure of platform governance as well as gathering forces in the digital economy with the increasing role of multinational technology companies.

Fifthly, it is advisable for countries to join hands in building regulations for multinational technology companies (Big Tech) so as to prevent them from intervening in other country’s political issues, even security, sovereignty and the international system.

Opportunities and challenges for Vietnam in digital integration

During 35 years of renovation and development, global integration has become a strategic policy, directly serving the needs of the country in line with major trends in the world. During the period 1986 - 2000, Resolution No. 13 of the 6th Politburo dated May 20, 1988 on the tasks and foreign policy in the new situation has shown the initial awareness of the internationalization process, thereby creating a prerequisite for a full awareness of globalization in the next stage. The 7th National Congress (1991) defined the strategy of “expansion, diversification and multilateralization of foreign economic relations on the principle of maintaining independence, sovereignty, equality and mutual benefit”(9). The 9th Congress (2001) determined the policy of “proactive integration into the international and regional economy”(10). The 10th Congress (2006) also affirmed the policy of “active and proactive integration into the international economy, reinforcement of international cooperation in other fields”(11). The 11th Congress (2011) expanded the strategy from “international economic integration” to “proactive, active and comprehensive integration”(12). On April 10, 2013, the Politburo issued Resolution No. 22-NQ/TW on globalization, which outlined important orientations and unified awareness of globalization. This is an important step forward in foreign policy thinking. The 12th Party Congress (2016) continued to set even higher requirements, which consist of “drastically implementing the strategy of proactive and active integration”(13). In 2016, the 12th Party Central Committee issued Resolution No. 06-NQ/TW on effectively implementing the process of economic integration, maintaining socio-political stability in the context of new generation free trade agreements. The 13th Party Congress (in 2021) emphasized that “it is essential to proactively, inclusively and effectively integrate into the world economy”(14) and well handle “the relationship between independence and self-reliance and globalization”(15).

Up to now, there have been multiple documents of the Party and State of Vietnam confirming the national development policy in the digital era, such as Resolution No. 23-NQ/TW dated March 22, 2018 of the Politburo on strategy of formulating policies on national industrial development to 2030, with a vision to 2045; Resolution No. 52-NQ/TW dated September 27, 2019 of the Politburo on a number of guidelines and policies to actively join the Fourth Industrial Revolution. On this basis, the Government has developed and promulgated national action programs and strategies for relevant fields, such as the Fourth Industrial Revolution, the National Digital Transformation Program and the National Strategy on AI research, development and applications.

With an updated theoretical foundation and foreign policy thinking on global integration, Vietnam has obtained a number of significant achievements: First, it makes an important contribution to promoting the socio-economic growth, renovating growth model, improving competitiveness and comprehensive power. In 35 years of renovation and globalization, from a backward, small-scale agricultural economy, Vietnam now has a GDP of $262 billion, an increase of more than 18 times, ranking 44th in the world. According to the 2020 edition of the annual Asia Power Index recently released by Independent Australian think tank the Lowy Institute on October 19, 2020, Vietnam ranked 12 of 26  for comprehensive power(16). Second, it contributes to accelerating the renovation process, building and perfecting the socialist-oriented market economy institution. Third, it maintains a peaceful and stable environment, safeguards national independence and sovereignty, expands and strengthens partnership with other countries, especially major countries and superpowers in the world. Fourth, it helps to affirm and enhance Vietnam's capacity in taking the initiate, leading and mediating. This is clearly demonstrated by Vietnam's success in organizing Asia-Pacific Economic Cooperation (APEC) Forum in 2017, the US-North Korea Summit in 2019, ASEAN 2020 Chair, assuming the role of non-permanent member of the UN Security Council for the 2020-2021 term and taking numerous initiatives that are highly appreciated by international community. Fifth, it plays a significant role in improving the material and spiritual life of the people as well as preserving the national cultural identity and protecting the environment. Localities, businesses and people have efficient access to opportunities that globalization brings.

These achievements have made Vietnam more confident on the path of globalization and the country could make the best use of new opportunities. Firstly, peace, cooperation and development are still common aspirations and efforts of all mankind. Although globalization and international integration have faced barriers over the past time, they still remain an evident trend. With a new position and power, Vietnam entered a new strategic period with comprehensive innovation, active participation in the Fourth Industrial Revolution and inclusive and comprehensive international integration. Secondly, success achieved after 35 years of Doi Moi reaffirms the correctness of Vietnam's foreign policy of independence and self-reliance as well as the policy of proactive, inclusive and comprehensive integration into the world. As Secretary General and President Nguyen Phu Trong affirmed: “Never before in the history of Vietnam has such a great potential, position and international prestige”(17). This is an important foundation for digital globalization in the near future, especially digital economy(18). Thirdly, through a network of more than 30 comprehensive strategic partners, strategic partners and comprehensive partners, Vietnam may attract resources and investments to improve national capacity in digital transformation and ensure independence, autonomy and security(19). Fourthly, Vietnam's international integration in the digital era will open up new methods and spaces for regional and international globalization, driving economic growth, innovation, rapid and sustainable development. Adopting technological breakthroughs of the Fourth Industrial Revolution becomes now a strategic opportunity for the country to move up the technological ladder and realize the development goals set out at the 13th Party Congress. Fifthly, digital integration enables Vietnam further promote its “soft power” and enhance its prestige and position. Economic networks and linkages allow the country to effectively take advantage of its commitments in economic integration, expand and deeply participate in the international economic linkages, and shape new legal frameworks in economic and trade, including upgrading and supplementing regulations on digital links, technological applications so as to establish COVID-19 travel corridors.

By contrast, digital integration brings to Vietnam countless challenges.

Firstly, regional and international situation changes unpredictably, causing huge obstacles for strategic forecasting. Strategic competition between major countries, local conflicts, and threats to security are forecasted to be more complicated and fiercer than before. The world economy is entering a new era in terms of the nature and level of production forces, changing profoundly production relations and social relations. Non-traditional security challenges, such as epidemics, climate change, water security, cyber security... are increasing.

Second, digital globalization also set new requirements for Vietnam, such as renewing thinking, moving from “expanding relationship, joining in international cooperation” to “actively contributing, taking the initiate and participating in shaping cooperation mechanisms” and the transformation of growth models associated with digital technology. In addition, challenges related to legalization and implementation of new-generation FTA commitments with high standards as well as new problems arising from the process of supplementing and upgrading provisions related to digital economy and digital technology are also facing Vietnam (20).

Third, Vietnam’s digital transformation capacity remains limited. So, it is hard to seize opportunities and embrace the Fourth Industrial Revolution. The country’s hesitancy in changing thinking and taking actions may lead to the risk of lagging further behind.

Fourth, there are higher requirements for digital globalization in order to promote its “soft power” and its new geo-strategic, geo-economic position so as to play the role of initiator and conciliator in matters of strategic significance to Vietnam. Digital globalization also poses new problems, such as catching up with development trends and new production methods of the world, balancing between ensuring network security and developing digital economy, between digital transformation and maintaining social security and stability, between attracting foreign direct investment (FDI) in technology and supporting domestic technology enterprises.

Fifth, there exist threats to security, social order and cyber sovereignty, socialist regime protection in a complex environment of cyberspace. With the notable rise of social media, hostile forces use increasingly sophisticated and complex methods and tricks, thus increasing the risk of social instability. In addition, there is problem of job creation and workforce retraining(22).

Some policy implications for Vietnam

On the basis of the analysis and assessment of the opportunities, challenges and problems mentioned above, for an inclusive, comprehensive, creative and effective integration in the digital era of Vietnam in the coming time, a due consideration should be given to the following solutions:

Firstly, upholding the foreign policy of independence and self-reliance; expanding its external relations towards diversification and multilateralization; thoroughly and creatively applying lessons learned on effectively handling relationship with major countries and neighboring countries; properly assessing trends, seizing opportunity. Maximizing all resources to meet the requirements of national construction and development and national defense in the new situation, especially in the development and application of technological advances as affirmed in the Document of the 13th National Congress and other important documents of the Party on “actively participating in the Fourth Industrial Revolution, the National Cybersecurity Strategy and the Strategy for the Defense of Homeland in Cyberspace” as well as Directive No. 25-CT/TW dated August 8, 2018 of the Secretariat on promoting and elevating multilateral relations to 2030 and so forth.

Secondly, persistently pursuing the goal of comprehensive and inclusive international integration for the benefit of the nation on the basis of international law, equality and mutual benefit in order to concretize the vision and aspiration to become a socialist - oriented developed country in the middle of the twenty-first century.

Thirdly, developing and perfecting the national legal framework to satisfy domestic needs, making the best use of international opportunities that the global integration brings.

Fourthly, strengthening political trust, forging stable and sustainable relations with neighboring countries, major countries, a network of more than 30 important partners and traditional friends by taking place creative and effective methods; considering development goal the core focus in relationships and seizing opportunities in economy - trade, investment, science - technology, especially digital technology, green development trends and sustainable development…; actively participating in multilateral institutions, contributing to the formation of regional and global structures, particularly considering the formulation of a regional cyber security network in Asia – Pacific(23); forging closer and more effective coordination between party diplomacy, state diplomacy, people-to-people diplomacy, defense and security diplomacy.

Fifthly, grasping situation and making effective forecasting to avoid unexpected situation. Accordingly, enhancing forecasting and information sharing on international integration, focusing on digital economy; expanding policy dialogue spaces, exchanging experiences and knowledge on digital globalization; raising awareness of cadres, party members and people from all walks of life about digital globalization; building a modern diplomacy, in which the top priority is given to defense and security diplomacy to protect the Homeland(24).

Sixthly, on the basis of Document issued by the 13th Party Congress as well as resolutions of the Central Committee and the Politburo on international integration, it is possible to consider studying, developing and promulgating a new document of the Communist Party of Vietnam on new orientations for inclusive and comprehensive international integration, especially in the digital era. A due consideration should be given to a number of connotations, such as digital economy integration creating spillover effect to the integration of other sectors; maintaining security and stability, social order, protecting the socialist regime and preventing threats from cyberspace... These new documents will serve as an important reference for relevant agencies to coordinate effectively in the near future.

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(1) In October 2013, the World Bank (WB) organized an international conference on development in a digital age. In 2014, the United Nations adopted the Resolution on the Right to Privacy in the Digital Age. In June 2020, the Association of Southeast Asian Nations (ASEAN) organized a Special Session of ASEAN Leaders on Women’s empowerment in the Digital Age. The Organization for Economic Co-operation and Development (OECD) sees the digital age as the context of many of its reports, https://www.worldbank.org/en/events/2013/09/20/development-digital-age-tech-and-poverty; https://www.cambridge.org/core/journals/international-legal-materials/article/united-nations-general-assembly-resolution-on-the-right-to-privacy-in-the-digital-age/ 136942F57940B12E0733852518E4B68C

(2) United Nations: The Impact of Digital Technologies, https://www.un.org/en/un75/impact-digital-technologies

(3) World Economic Forum (WEF): “Digital transformation of industries”, 2016, http://reports.weforum.org/digital-transformation-of-industries/ wp-content/blogs.dir/94/mp/files/pages/files/wef-digital-transformation-of-industries-2016-exec-summary.pdf

(4) International Data Corporation (IDC): “Worldwide Digital Transformation 2020 Predictions”, 2019, https://www.idc.com/getdoc.jsp?containerId=prUS45617519

(5) Felipe L Monteiro, Gabriel Rozman, Anne-Marie Carrick: “Digital Transformation in Latin America: A Leapfrogging Opportunity”, 2019

(6) Twiplomacy: “Twiplomacy Study 2020”, https://twiplomacy.com/blog/twiplomacy-study-2020/

(7) “29 Must-know Cybersecurity Statistics for 2020”, https://www.cyber-observer.com/cyber-news-29-statistics-for-2020-cyber-observer/

(8) Chinese President Xi Jinping said that cyber sovereignty is respecting the right of each country to choose its path of internet development, the internet governance model, and internet public policy as well as the equal access to the governance of international cyberspace. See also: “Remarks by H.E. Xi Jinping President of the People’s Republic of China” At the Opening Ceremony of the Second World Internet Conference, December 16, 2015, https://www.fmprc.gov.cn/mfa_eng/wjdt_665385/zyjh_665391/t1327570.shtm

(9) Documents of the 7th N National Party Congress, The National Politics Truth Publishing House, 1991, p. 119

(10) Document of the 9th N National Party Congress, The National Politics Truth Publishing House, 2001, p. 120

(11) Documents of the 10th National Party Congress, ibid, 2006, p. 112

(12) Document of the 11th National Party Congress, ibid, 2011, p. 236

(13) Document of the 12th National Party Congress, Office of the Party Central Committee, 2016, vol. 2, p. 154

(14), (15) Documents of the 13th National Party Congress, The National Politics Truth Publishing House, 2021, pp. 331, 333

(16) See: “Vietnam: Ranked 12 of 26 for comprehensive power, with an overall score of 19.2 out of 100”, https://power.lowyinstitute.org/countries/vietnam/

(17) Resolution of the 13th National Party Congress, https://nhandan.com.vn/chinhtri/nghi-quyet-dai-hoi-dai-bieu-toan-quoc-lan-thu-xiii-636568 /, accessed April 5, 2021

(18) According to research by Google (USA) and Temasek (Singapore), Vietnam's digital economy reached 12 billion USD in 2019, making Vietnam one of the fastest - growing digital economies in Southeast Asia. It is forecasted that by 2025, Vietnam’s digital economy is expected to top 43 billion USD, https://www.blog.google/documents/47/SEA_Internet_Economy_Report_2019.pdf

(19) According to the World Competition Center (WCC), Vietnam's partners have strengths in digital technology, including the US, China, Korea, Singapore, Denmark, Sweden, Finland, the Netherlands

(20) Digital economy FTAs, digital linkage mechanisms are new issues, requiring research on methods (new signing or upgrading from existing FTAs), forms (bilateral, tripartite – quadrilateral or multilateral cooperation), types of agreements (FTA, economic linkage agreement...), selection of partners in the context of fiercer competition between major countries and increasing protectionism as well as impact from COVID-19 epidemic

(21) According to the World Bank (WB), for digital transformation, Vietnam needs to ensure factors such as digital connectivity, digital payment ecosystem, digital labor skills, and logistics for the digital economy and also relevant policies and regulations, http://documents.worldbank.org/curated/en/328941558708267736/

(22) The International Labour Organization (ILO) forecasts that in the next 10 years, about 56% of the total number of jobs in 5 ASEAN countries, including: Cambodia, Indonesia, Philippines, Thailand and Vietnam will run the risk of being lost due to technological revolution, https://www.ilo.org/wcmsp5/groups/public/---ed_dialogue/--- act_emp/documents/publication/wcms_579554.pdf

(23) Considering upgrading the security structure in the Asia-Pacific region (including cyberspace) should focusing on three main questions: 1- Early warning; 2- Building trust; 3- Capacity building

(24) An independent survey from researchers shows that a relatively high number of businesses, people, youth and NGOs are aware of the importance of digital transformation (50% - 80%). Young people show their ambition and confidence (90%) in the country's efforts to innovate, digitally transform, develop and apply technology, build modern diplomacy...

This article was published in the Communist Review No. 965 (May 2021)