Binh Duong to assist SME in digital transformation

According to Vice Chairman of the People's Committee Nguyen Van Danh, there are more than 57,000 businesses in the province, of which more than 97% are small and medium-sized businesses. Over 90% of SMEs were severely impacted by the COVID-19 pandemic as the traditional market and production decreased.

To adapt to the new environment and change how they conduct business, SMEs need digital transformation tools. In addition to affecting demand, the pandemic has caused a labor shortage, and after it passes, small and medium-sized enterprises will need to increase their use of digital technology to survive and operate effectively.

Binh Duong to assist SME digital transformation.

Digital transformation is the integration of digital technology across all functions of an organization, changing the organization's operations fundamentally. Experts opine that now is the ideal time for small and medium-sized enterprises (SMEs) to adopt technology in management and undergo a digital transformation; consequently, it is crucial to implement policies expeditiously to assist them in overcoming obstacles and resuming operations, especially during the transformation.

Danh stated that in order to persuade businesses to embrace digital transformation, the provincial government would develop a legal framework to assist businesses in innovating and avoiding potential legal risks. According to experts, policies that support businesses and foster their adoption of new technologies and digital transformation are required, particularly those that permit the testing of novel products and cutting-edge technologies that still face legal challenges.

According to them, the province must foster the growth of large technology companies, educate the public about the advantages of digital transformation and digital technologies, and establish basic standards for digital transformation to assist businesses in mitigating the associated risks. It must invest in technology infrastructure that only it can provide, adopt policies to encourage and support creative start-ups, and cultivate human capital for digital transformation.

USAID, along with the Ministry of Planning and Investment and Binh Duong province, will implement a program called USAID Linkages for Small and Medium Enterprises to improve supply chain links for SMEs and the capacity of business associations to support the growth of SMEs.

It aims to facilitate systemic changes in the business environment by reforming institutions, simplifying administrative regulations and procedures, and reducing the cost of implementing administrative procedures in order to improve the competitiveness of businesses, thereby enhancing their capacity to integrate internationally, including into the global SME value chain.

While FDI in Vietnam had reached record levels, the limited supply chain linkages of Vietnamese SMEs had a negative impact on the spillover benefits for the domestic economy, according to USAID.

The program aims to close this gap by enhancing the capacity of intermediary organizations in Vietnam, such as business associations, export development centers, and SME promotion agencies, to facilitate supplier-buyer relationships between Vietnamese SMEs and lead firms based in Vietnam and increase the capacity of Vietnamese SMEs to take part in manufacturing supply chains. Binh Duong has 403 projects with foreign investment worth over 6.8 billion USD.