Vietnam’s Emerging AI Sector: Opportunities and Regulatory Landscape

Exploring Vietnam’s Growing AI Sector and Future Developments

Vietnam is experiencing a notable transformation in its technological landscape, primarily driven by its increasing focus on artificial intelligence (AI) development. With various initiatives underway, the country is positioning itself as a significant player in the AI arena within the ASEAN region.

The Regulatory Framework Shaping AI Development

As the AI sector flourishes, Vietnam’s government is dedicated to creating a conducive legal environment that addresses the unique challenges and opportunities presented by this technology. Unlike the extensive regulations seen in the European Union with its AI Act, Vietnam is taking a more nuanced approach, inspired by practices in the UK and China.

The National Strategy on Research, Development, and Application of Artificial Intelligence to 2030, established in 2021, lays the foundation for this evolution. This strategic plan emphasizes a phased progression through research, development, and large-scale application, aiming to catapult Vietnam into a leading AI innovation hub by 2030.

Key Regulatory Developments: Recent and Upcoming

In tandem with its strategic vision, Vietnam has rolled out several significant regulatory measures to bolster its AI framework:

• Decree No. 13/2023/ND-CP: Issued on April 17, 2023, and effective from July 1, 2023, this decree aligns Vietnamese data protection regulations with global standards, such as the EU’s General Data Protection Regulation (GDPR). It underscores the government’s commitment to privacy and data rights in AI development.

• Decision No. 1290/QD-BKHCN: Introduced in June 2024 by the Ministry of Science and Technology, this document outlines nine principles for responsible AI research and development, emphasizing transparency, safety, and respect for human rights.

The anticipated Legislation for the Digital Technology Sector, expected to be drafted by October 2024, will include specific regulations dedicated to AI, aiming to provide clarity and support for businesses and investors navigating this burgeoning landscape.

Insights on Future Regulation: 2025 and Beyond

As the landscape continues to evolve, Vietnam is gearing up for comprehensive legal measures expected to be implemented by 2025. The Resolution No. 57-NQ/TW, introduced on December 22, 2024, will focus on four pillars essential for digital technology innovation:

1. Flexible Governance: Aimed at promoting innovation by avoiding overly restrictive lawmaking approaches.

2. Integrated Infrastructure: Building a robust infrastructure to facilitate safe and efficient AI applications.

3. High-Quality Workforce: Emphasizing education and training to cultivate a skilled talent pool in AI.

4. Enhanced Intellectual Property Protection: Strengthening regulations relating to data security and technology safeguards.

Detailed Look at the Draft Laws

Draft Law on Digital Technology Industry (Draft DTI Law)

The draft comprises eight chapters and 73 articles, with a focus on investment and regulatory incentives in the tech sector:

• Investment Incentives: Special corporate tax benefits and R&D expense deductions to attract domestic and foreign investments.

• Responsible AI Development Regulations: Provisions to prevent harmful AI practices and implement transparency through labeling requirements of AI-generated products.

• Regulatory Sandbox: A proposed trial period for innovative AI products to enable controlled testing without the constraints of rigid regulations.

Draft Law on Personal Data Protection (Draft PDP Law)

This draft aims to protect personal data across multiple sectors, including AI. Key provisions include:

• Informed Consent: Requirement for organizations to inform individuals whose data is being utilized, ensuring transparency.

• Withdrawal Rights: Empowering individuals to opt-out of data collection processes.

Key Players in Vietnam’s AI Landscape

Vietnam’s AI sector is seeing substantial interest from international technology giants. Companies like Qualcomm and Samsung have established significant R&D centers, while NVIDIA plans to invest heavily in developing AI ecosystems within the country. These endeavors highlight Vietnam’s appeal as a strategic hub for tech development, bolstered by a rich talent pool and government support.

The Workforce: Building the Future of AI

Vietnam’s education system is preparing thousands of graduates in IT and engineering fields every year. With an annual production of around 50,000 tech graduates, the country is nurturing a skilled workforce capable of driving AI innovation.

Conclusion

Vietnam is swiftly evolving into a key player in the realm of artificial intelligence. With its strategic regulatory developments, supportive legal framework, and robust talent pipeline, the country is setting the stage for substantial growth in the AI sector. As international investors take note, Vietnam’s future as an AI innovation hub appears bright.