ENHANCING INFORMATION TECHNOLOGY APPLICATION AND DIGITAL TRANSFORMATION IN TRADE PROMOTION IN VIETNAM

MINISTRY OF EDUCATION AND TRAINING
FOREIGN TRADE UNIVERSITY
-------o0o------

MASTER THESIS
ENHANCING INFORMATION TECHNOLOGY
APPLICATION AND DIGITAL TRANSFORMATION
IN TRADE PROMOTION IN VIETNAM

FULL NAME: TA QUOC ANH

MAJOR: INTERNATIONAL ECONOMICS

Ha Noi - 2023


MINISTRY OF EDUCATION AND TRAINING
FOREIGN TRADE UNIVERSITY
-------o0o------

MASTER THESIS
ENHANCING INFORMATION TECHNOLOGY
APPLICATION AND DIGITAL TRANSFORMATION
IN TRADE PROMOTION IN VIETNAM

Major: International Economics
Specialization: Master of Research in International Economics
Code: 821116

Full name: Ta Quoc Anh
Supervisor: Assoc Prof, Dr. Hoang Xuan Binh

Ha Noi - 2023


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STATEMENT OF ORIGINAL AUTHORSHIP
I hereby confirm my direct involvement in the creation of this thesis under the
mentorship and oversight of Associate Professor Dr. Hoang Xuan Binh. I validate
that the content within this thesis are accurate and adhere to the principles of research
ethics. The data and illustrations included in this work have been derived from the
scrutiny, interpretation, and assessment of diverse sources, each of which has been
suitably acknowledged in the reference list.
In addition, I have duly recognized and referenced any external opinions,
assessments, or data procured from other authors and entities. The author assumes
full accountability for any deceitful actions that may be identified within the thesis.
Ha Noi,
Author

(signature and full name)


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ACKNOWLEDGEMENTS
I would like to express my profound gratitude to Associate Professor Dr.
Hoang Xuan Binh for his remarkable patience and insightful feedback on my thesis.
My journey would have been unattainable without the steadfast support and expertise
of my defense committee. I owe a significant debt of gratitude to the Faculty of
Graduate Studies at Foreign Trade University for their generous backing, which has
materialized this endeavor.

I am inclined to acknowledge my classmates and friends for their support in
editing, late-night feedback discussions, and unwavering moral reinforcement.
Additionally, I am appreciative of the university's librarians, research assistants, and
study participants, whose influence and inspiration have profoundly influenced my
work.
Furthermore, I would like to express my utmost appreciation to my parents,
whose unwavering support and continuous encouragement have been pivotal
throughout my years of study and the process of researching and composing this
thesis. Without their presence, this accomplishment would have remained beyond
reach. Thank you.


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TABLE OF CONTENTS
STATEMENT OF ORIGINAL AUTHORSHIP .................................................... i
ACKNOWLEDGEMENTS ......................................................................................ii
SUMMARY OF THESIS RESEARCH RESULTS .............................................vii
INTRODUCTION ..................................................................................................... 1
CHAPTER 1: THEORETICAL BASIS ON INFORMATION TECHNOLOGY
APPLICATION AND DIGITAL TRANSFORMATION IN TRADE
PROMOTION ......................................................................................................... 12
1.1 Some related concepts ................................................................................... 12
1.1.1 Concept of trade promotion ....................................................................12
1.1.2. Concept of information technology application .....................................14
1.1.3. Concept of digital transformation ..........................................................15
1.1.4.

Concept

of

Information

technology

application

and

digital

transformation in trade promotion ...................................................................17
1.2 Trade Promotion Activities ............................................................................ 18
1.2.1. Trade Promotion Activities at the Government Level ............................18
1.2.2. Trade Promotion Activities at trade promotion organizations level .....19
1.3 Criteria for evaluating the level of enhancing digital transformation and IT
application in trade promotion activities............................................................. 20
1.3.1. Criteria for evaluating mechanisms, policies, and state orientations ...20
1.3.2. Criterias for evaluating awareness and capabilities in digital
transformation and IT application of trade promotion organizations and
bussinesses ........................................................................................................21
1.4 Factors influencing IT application and digital transformation in trade
promotion activities .............................................................................................. 25
1.4.1. Direction and Policy of the Government ................................................25
1.4.2. Awareness and Capacity from Trade Promotion Organizations and
Businesses .........................................................................................................26
1.4.3. Technological Development ...................................................................27
1.5 International experiences from some countries in Information Application
and Digital Transformation ................................................................................. 27

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1.5.1. Japan ......................................................................................................27
1.5.2. Korea ......................................................................................................29
1.5.3. Thailand ..................................................................................................31
1.5.4. International lessons learned for Viet Nam ...........................................33
CHAPTER 2: CURRENT SITUATION OF INFORMATION
TECHNOLOGY APPLICATION AND DIGITAL TRANSFORMATION IN
TRADE PROMOTION IN VIETNAM ................................................................ 36
2.1 Overview of information technology application and digital transformation
in trade promotion................................................................................................ 36
2.1.1. Mechanisms and Policies .......................................................................36
2.1.2. Technology Platforms.............................................................................37
2.1.3. Digital trade promotion ecosystem ........................................................40
2.2. Analysis of the current situation of information technology application
and digital transformation in trade promotion in vietnam ................................ 43
2.2.1. In Govermental trade promotion organizations.....................................43
2.2.2. In Business support organisations (BSOs) .............................................49
2.2.3. In Businesses ..........................................................................................53
2.3. Assessment of information technology application and digital
transformation in trade promotion in vietnam ................................................... 64
2.3.1. Achievements ..........................................................................................64
2.3.2. Limitations and causes ...........................................................................67
CHAPTER 3: ORIENTATIONS AND SOLUTIONS TO ENHANCE
INFORMATION TECHNOLOGY APPLICATION AND DIGITAL
TRANSFORMATION IN TRADE PROMOTION IN VIETNAM ................... 78
3.1 Orientations to enhance information technology application and digital
transformation in trade promotion in Viet Nam................................................. 78
3.2. Development goals for the period of 2023-2025 and the direction for the
year 2030 .............................................................................................................. 78

3.2.1. General Objective for the period of 2023-2025 and the direction for the
year 2030 ..........................................................................................................78


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3.2.2. Specific Objectives for the period of 2023-2025 and the direction for the
year 2030 ..........................................................................................................79
3.3. Some solutions to enhance information technology application and digital
transformation in trade promotion in vietnam ................................................... 80
3.3.1. Developing the Digital Trade Promotion Ecosystem .............................80
3.3.2. Enhancing Awareness and Capacity ......................................................83
3.3.3. Improving Mechanisms and Policies .....................................................83
3.3.4. Other Solutions .......................................................................................84
CONCLUSION ........................................................................................................ 85
LIST OF REFERENCES ....................................................................................... 87


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LIST OF FIGURES

Figure 1. Applying technology platforms/social networks to trade promotion
activities, supporting trade promtion for businesses in the local area. ........... 51
Figure 2. Level of Data Sharing and Connectivity for Trade Promotion ....... 52
Figure 3. Business Expectations in Digital Technology Application by Scale
(%) ................................................................................................................... 56
Figure 4. Investment Structure in IT Infrastructure of Businesses ................. 57
Figure 5. Commonly Used Software by Businesses ....................................... 58
Figure 6. Investment Levels in Various Digital Marketing Channels ............ 60
Figure 7. Number of Websites Verified by the Ministry of Industry and Trade,
2017-2022........................................................................................................ 60

Figure 8. Reported Issues on the E-commerce Activity Management Portal in
2022 ................................................................................................................. 63
Figure 9. Prioritized needs to enhance IT application .................................... 75
Figure 10. Challenges for Digital Transformation in Businesses and
Organizations .................................................................................................. 76

LIST OF TABLES
Table 1. Evaluation of the importance and practicality level of IT application and
digital transformation among surveyed Cooperatives. ............................................. 55


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SUMMARY OF THESIS RESEARCH RESULTS
Within the context of the fourth industrial revolution, marked by significant
technological advancements, and influenced by global occurrences like the Covid-19
pandemic, various commercial undertakings, interpersonal connections, and
governmental services are progressively transitioning into the realm of digital
platforms. The process of digital transformation and the integration of information
technology into trade promotion endeavors have evolved from being pioneering
efforts to becoming indispensable and pressing responsibilities for pertinent agencies
and organizations.
The primary objective of the author is to meticulously examine and evaluate
the existing landscape of information technology application and digital
transformation concerning trade promotion within the context of Vietnam. Through
a thorough analysis, the research endeavors to propose strategic directions and viable
remedies aimed at fostering the implementation of information technology and
facilitating digital transformation in the sphere of trade promotion. These proposed
strategies encompass both short-term and long-term perspectives.

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INTRODUCTION
1. Rationale
The fourth industrial revolution (industry 4.0) has brought achievements in
various fields, particularly in technology, innovation, and fostering growth model
transformations. In this context, the application of information technology and digital
transformation is becoming an essential trend in all aspects of life, economy, and
society. Developing countries are not necessarily lagging behind in the process of
accessing and applying the industry 4.0 revolution. Due to unprecedented speed and
scale of development, industry 4.0 can interact with the process of international
economic integration and domestic policy-making.
During the period from 2021 to 2030, the global economy and the Asia-Pacific
region are projected to undergo significant and more uncertain fluctuations. Despite
the deceleration, overall international economic integration and trade liberalization
continue to be dominant trends worldwide. Some "like-minded" countries are
increasing their collaboration to support the recovery and reform of the multilateral
trading system, particularly the World Trade Organization (WTO). Many countries
are also transitioning their growth models by effectively leveraging economic
integration to achieve higher quality growth, increased labor productivity, and
competitive capacity through greater contributions from science and technology.
Throughout this process, the application of digital technology in various stages of the
value chain continues to gain popularity, such as the implementation of blockchain
in logistics, product traceability, and paperless trade models.
In the field of trade promotion (TP), many countries and territories have been
and are accelerating the adoption of information technology and digital
transformation. Among them are several countries and territories geographically
close to Vietnam and with similar cultural characteristics, such as Japan, South Korea,
Hong Kong, Taiwan, Thailand, etc. Leading technology countries worldwide have
also been at the forefront of IT application and digital transformation in trade
promotion. The content and methods of IT application and digital transformation in

trade promotion are constantly changing and becoming more diverse, extending


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beyond IT application infrastructure and skills to further develop CRM, digital
marketing, and other areas, aiming for a comprehensive ecosystem in trade
promotion.
The true driving force behind the aforementioned shift originates from the
reality that businesses of all types and sizes globally are facing a rapidly changing
market. Since the beginning of 2020, the COVID-19 pandemic has caused disruptions
and interruptions in global supply chains and trade, necessitating fundamental
changes and adaptations in traditional business models and management approaches.
In this context, the increased application of information and IT application and
advancements in Internet of Things, artificial intelligence, and other technologies are
no longer options but rather obligatory directions for all organizations and enterprises
to adapt to and leverage new opportunities in order to maintain and expand their
market presence. The number of technologies and e-commerce application platforms,
as well as production and sales management systems, is increasing day by day, with
an increasing number of domestic and international businesses deeply and
extensively implementing them over the years to exploit timeless and borderless
values.
To support the business community, government agencies and public service
providers must make efforts to keep up, and even stay one step ahead, of the digital
transformation process in enterprises, as well as the profound changes in society and
the economy associated with digital transformation in general. This requirement is
particularly crucial for trade promotion organizations due to certain specific factors.
Firstly, the target audience of trade promotion agencies (customers) consists of
businesses that must adapt to the trend and requirements of digital transformation in
order to conduct international and domestic trade activities. Secondly, the
establishment of services for trade promotion agencies partly relies on what

individual businesses cannot independently address, such as market information,
technological solutions, or difficulties in accessing technology changes in the markets
that businesses are targeting or will target. Thirdly, most trade promotion agencies
operate within a national and international system with diverse partners, involving


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collaborative processes between the state and private enterprises. Therefore, effective
management and coordination are necessary to ensure a synchronized digital
transformation of the entire economy. For example, in order to comply with the
General Data Protection Regulation (GDPR) of the European Union (EU), trade
promotion agencies and government bodies need to innovate their operational
methods, starting from data collection instead of relying on renting or borrowing
databases as before.
Within the country, the Party and the State have identified one of the key
socioeconomic development perspectives for the period 2021-2030 as rapid and
sustainable development primarily based on science, technology, innovation, and
digital transformation. They proactively seize timely opportunities and effectively
leverage the Fourth Industrial Revolution (Industry 4.0) to restructure the economy,
promote digital economy, and consider it as a decisive factor in enhancing the
productivity, quality, efficiency, and competitiveness of products, businesses, and the
economy. This perspective has been and is being concretized in a series of documents,
including the National Digital Transformation Program until 2025, with a vision
toward 2030, the Strategy for Developing the E-Government toward the Digital
Government in the period 2021-2025, with a vision toward 2030, etc.
Despite initial proactive efforts and positive transformations, IT application
and digital transformation in Vietnam's trade promotion activities is still at a
rudimentary stage, lagging behind the evolving trends and practical requirements of
trade promotion operations. One significant reason is the absence of a comprehensive
long-term strategic orientation specifically dedicated to IT application and digital

transformation in trade promotion activities. Furthermore, many agencies,
organizations, and enterprises have not fully grasped the significance of IT and digital
transformation in trade promotion activities and have not prioritized investment and
attention towards enhancing the capacity for IT application and digital transformation
in trade promotion.


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2. Literature Review
Research on Trade Promotion
The research "Enhancing Promotion Activities to Boost Vietnamese
Enterprises' Exports to the EU Market" by author Do Thi Huong (2009) pointed out
that in the context of economic openness and international integration, exports hold
a central position in the foreign economic activities of many countries such as Japan,
South Korea, Singapore, Thailand, and China. In reality, our country still lacks an
effective national export promotion organization network, and export promotion
becomes increasingly important and necessary to support Vietnam's export
development. Therefore, Vietnam needs promotion activities by the government and
industry associations that are tailored to the specific characteristics of the EU market
and truly beneficial in supporting businesses' export activities to the EU market.
Research on "Barriers and procedures for importing food products into some
markets with potential for development in order to expand the market in the future"
by the Vietnam Trade Promotion Agency (VIETRADE) in 2013 focused on
surveying barriers and procedures for importing food products for a number of
potential markets such as the US, EU, and Japan, and proposing measures to help
businesses overcome these barriers to develop and expand export markets. The goal
of the research is to meet the needs of business expansion in the future, while
understanding and analyzing specific regulations, processes and barriers in food
import activities of the aforementioned potential markets. In addition, this study has
identified the difficulties and challenges faced by enterprises when exporting food

products and from that, it has proposed measures to reduce barriers, improve
procedures and enhance the ability to export food products. competitiveness of
Vietnamese goods in the international market.
In the article "Enhancing the effectiveness of trade fairs and exhibitions in
Vietnam's export activities" published in the Journal of Industry and Trade in May
2020, Nguyen Thi Thu Thuy affirmed that in the context of economic integration,
alongside traditional trade promotion activities such as advertising and promotions,
trade fairs and exhibitions are effective methods widely used by Vietnamese


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businesses and trade promotion organizations. The author also assessed the practical
situation and analyzed the enhancement of the effectiveness of trade fairs and
exhibitions in Vietnam's import-export activities by highlighting the advantages and
limitations in implementing and participating in trade fairs and exhibitions abroad.
"Research and propose solutions to promote exports of goods to the EU in terms
of EVFTA implementation" is a ministerial-level scientific research project
conducted by the Trade Promotion Agency in 2020. This study has shown that the
implementation of the EVFTA Agreement has created a strong impetus for the growth
of Vietnam's goods exports, while helping to diversify markets and export products,
especially those in which Vietnam has competitive advantage. To promote trade
promotion and export activities to the EU market, the study proposes a number of
important solutions. One of them is the selection of products and markets to prioritize
for export promotion, in order to create the necessary momentum to increase access
to and exploit the potential of the EU market for Vietnamese export products. These
solutions aim to increase the interest and support from the government and related
organizations, helping businesses to promote export and access market information
effectively. From there, the implementation of the EVFTA and the promotion of
goods exports to the EU will be promoted effectively and sustainably, contributing to
enhancing Vietnam's peripheral resources and economic development.

In the article "Improving the effectiveness of national trade promotion in the
new situation" published in the Financial Review in April 2018, Nguyen Thuy Van
emphasized that trade promotion activities need to be improved in both quality and
quantity, deploying diverse coordination with many measures both at home and
abroad, towards the goal of maximizing professionalism and efficiency. In particular,
trade promotion activities play an important role in supporting enterprises to boost
export growth, contributing to the country's economic growth.
Clara Brandi's report entitled “Successful trade promotion - Lessons from
emerging economies” (2013) studied emerging economies such as China, India, and
Brazil to the activities that these countries have taken to improve and improve
efficiency in trade activities. The study analyzed how countries facilitate trade,


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focusing on providing infrastructure, facilitating trade, which is an important driver
of economic development. According to Clara, focusing on investment in
infrastructure contributes to the success of trade promotion activities, creating high
efficiency in trade promotion activities. In addition, it is necessary to invest in the
development of roads, railways, seaports, energy and telecommunications industries,
and facilitate trade by improving rules and procedures in transactions. Ellen Eichhorn
and Ed Porter (2017) have shown that trade promotion tools such as advertising,
promotions, and exhibitions will help promote production and business activities,
increase sales and revenue and profits for modern retail businesses. Retailers need to
constantly innovate methods in trade promotion to suit each stage of the business and
meet the needs of consumers.
Research on Digital Transformation
Nowadays, digital transformation is a widely discussed topic because it is an
essential trend with a crucial role in the 4.0 Industrial Revolution. The Vietnamese
government also has placed special emphasis on digital transformation in the context
of the 4.0 Industrial Revolution and its application in various sectors of the economy.

According to Nguyen Thi Kim Ngan (2021), in Vietnam, the concept of "digital
transformation" is often defined as the process of transitioning from traditional
operating models to digital models by applying new technologies such as big data,
Internet of Things (IoT), cloud computing, etc., to change operational methods,
leadership, work processes, organizational culture, and increase the value of
organizational activities. Therefore, according to Ngan, digital transformation is not
only important for businesses but also for other sectors of the economy and society,
such as the government, mass media, healthcare, science, and education, which
should all strongly embrace digital transformation.
In business and trade activities, the majority of Vietnamese enterprises are
currently in the stage of exploring or just beginning to understand digital
transformation, and most of them have not yet been able to apply the strengths of
digital transformation in their production and business operations (Nhi, Phuong,
Quynh, Thanh, & Cong, 2023). Hence, the role of the government in general and


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relevant organizations in particular is crucial in raising awareness and supporting
businesses in their commercial activities. PGS.TS Phan The Cong (2023) emphasized
that digital transformation is an integral part of Vietnam's economic development,
requiring coordination and mutual support between state management agencies and
businesses.
In their research article "EVFTA and Digital Economy in Vietnam," Binh and
Phuong (2021) highlighted that Vietnam has undergone over 40 years of
industrialization, modernization, and integration, where technology and innovation
have played a crucial role in the country's economic development. Specifically,
digital transformation has been studied and implemented in various sectors, ranging
from manufacturing and agriculture to finance, healthcare, education, and commerce.
According to Phuong's study, Vietnam possesses abundant IT human resources, and
many digital platforms have been developed, high-speed internet services within the

region. Therefore, it is essential and entirely feasible for digital transformation to
permeate all sectors of the Vietnamese economy.
According to Ćuzović (2022), with the development of technology, big data,
and the internet, the path to a digital economy is gradually opening up and permeating
every aspect of the global economy. Trade, being the oldest economic activity and
the most adaptable aspect of the economy, faces the challenges of the modern world
and needs to leverage artificial intelligence, digitalization, mobile platforms, and
social commerce to create new competitive advantages. Traditional trade activities
are gradually giving way to digital economic activities, hence governments and
businesses that do not adapt to the current trends will risk falling behind and hindering
their own development. Author Sadinovich (2022) also noted that the outbreak of the
pandemic has acted as a catalyst for the development of contactless shopping,
demonstrating the importance of online commerce. However, some traditional
retailers are still struggling with digital transformation and the application of
information technology.
In the article "Role of government to enhance digital transformation in small
service business," author Chen (2021) asserts that the government plays a significant


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role in connecting, supporting, and creating conditions for small and medium-sized
enterprises (SMEs) in their digital transformation journey and promoting digital tools
and information technology applications. The government can provide funding
programs, establish training platforms, or build and operate platforms for SMEs to
participate in digital transformation.
Research gap
Currently, there are some domestic research works related to the research topic,
covering aspects such as the application of information technology and digital
transformation in the economy and overall state management. There are some studies
that focused on trade promotion, export promotion, and provide assessments of the

current situation of trade promotion for specific industries and markets. However, it
can be observed that there is no comprehensive published research work evaluating
the overall application of information technology and digital transformation in trade
promotion activities along with specific solutions and innovations for this topic.
Therefore, this study aims to analyze and evaluate the status of information
technology and digital transformation in trade promotion activities from 2010 to
2022. Based on this analysis, the study will propose objectives and effective solutions
for the application of information technology in trade promotion activities in Vietnam
from 2021 to 2030.
Moreover, domestic studies on digital transformation and mechanisms,
policies related to digital transformation have mentioned research on theoretical
foundations and practical aspects of digital transformation, as well as policies and
management tools for trade promotion. However, these studies are not
comprehensive enough as they have not thoroughly researched and evaluated
mechanisms and policies for trade promotion in the new context of the Covid-19
pandemic, the Fourth Industrial Revolution, the U.S.-China trade war, the RussiaUkraine conflict, and other emerging situations. Therefore, there is still a research
gap that needs to be addressed regarding mechanisms and policies for trade promotion
in the new context.


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3. Research Objectives
This Thesis focuses on evaluating the current situation of enhancing IT
application and digital transformation in trade promotion Viet Nam, in order to
propose solutions for this matter in Viet Nam.
4. Research tasks
To achieve the set objective, the thesis carries out the following research tasks:
- Systematize the theoretical foundation for enhancing the information
technology application and digital transformation in trade promotion
- Collect data and analyze various aspects of human resources in Quang Ninh

province to interpret the current situation, identify strengths and weaknesses, and
determine the causes.
- Research and evaluate the current situation of the information technology
application and digital transformation in trade promotion in Viet Nam and worldwide.
- Present viewpoints, goals, orientations, and solutions.
5. Research object and scope of the research
Research Object
Enhance information technology application and digital transformation in trade
promotion in Vietnam.
Scope of the research
In terms of content, the Thesis will focus on analyzing the following aspects:
- Assessing the current status of IT application and digital transformation in
trade promotion activities at the governmental trade promotion organizations,
business support organizations, and businesses, cooperatives in Vietnam. The
evaluation will concentrate on assessing the capacities, processes, tools,
technological platforms, and internal organizational systems of each entity, as well as
their capacities, processes, and systems for connecting with other relevant
stakeholders in trade promotion activities.
- Researching activities and implementation plans to enhance the application of
IT and digital transformation in trade promotion activities at selected entities within
the trade promotion network.


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- Studying documents, models, and global trends in the application of IT and
digital transformation.
The application of IT and digital transformation in trade promotion activities is
carried out in various government trade promotion agencies, including:
- The Vietnam Trade Promotion Agency (Ministry of Industry and Trade),
which is the central-level agency responsible for the state management of trade

promotion nationwide.
- Trade Offices, Trade Branches, and Trade Promotion Centers/Offices located
in different countries.
- Departments, boards, sectors, and centers with functions related to trade
promotion, aiming to provide direct support to local businesses.
Furthermore, the application of IT and digital transformation in trade promotion
activities is also implemented in trade promotion support organizations as well as in
enterprises, cooperatives, and individual businesses.
In terms of space and time:
- Investigating the current status of IT application and digital transformation in
trade promotion activities worldwide and in Vietnam during the period of 2010-2022.
- Researching the trends in IT application and digital transformation in trade
promotion activities worldwide and in Vietnam from 2022 to 2025, with a focus on
the year 2030.
- Proposing solutions to enhance the application of IT and digital transformation
in trade promotion in Vietnam from 2022 to 2025, with a focus on the year 2030.
6. Research methods
Applying quantitative research methods to analyze, statistically compare and
contrast secondary data to understand the current situation of trade promotion
development.
- Secondary data: Research data from reports of governmental organizations
such as the Ministry of Industry and Trade, General Statistics Office, General
Department of Vietnam Customs, ... and other internet sources.


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- Synthesis analysis method: Synthesize and anaylize documents on the
conditions and current state of information technology application and digital
transformation in trade promotion from existing studies. Then, evaluate and process
sociological survey data.

7. Thesis structure
In addition to the introduction, conclusion, tables, list of abbreviations, and
references, the research paper is structured into three chapters:
Chapter 1: Theoretical basis on information technology application and
digital transformation in trade promotion
Chapter 2: Current situation of information technology application and
digital transformation in trade promotion in Viet Nam
Chapter 3: Orientations and solutions to enhance information technology
application and digital transformation in trade promotion in Viet Nam


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CHAPTER 1: THEORETICAL BASIS ON INFORMATION
TECHNOLOGY APPLICATION AND DIGITAL
TRANSFORMATION IN TRADE PROMOTION
1.1 Some related concepts
1.1.1 Concept of trade promotion
In the modern economy, as free trade and international commerce become
increasingly prevalent, countries are striving to deeply integrate into the international
market. In this development, competition and technological innovation are essential
factors. Therefore, in order to maintain the strong domestic market and expand into
the international market, both governments and businesses need to proactively
coordinate various improvement activities, in which trade promotion is an
indispensable activity.
For businesses involved in import-export activities and economic-commercial
management agencies in Vietnam, the term "trade promotion" is not unfamiliar, but
in practice, there are various interpretations of this concept (Thuong, Thanh, &
Huong, 2005).
From a linguistic perspective, "promotion" refers to encouragement, support,
expansion, or advancement. Therefore, "trade promotion" is a type of behavior that

directly impacts trade activities. Understood as "making progress faster," the term
"promotion" is seen as activities that seek and promote the development and
exploitation of a certain object or phenomenon in a better way. This term is widely
used in various fields of economic, life, and legal. Accordingly, the concept is widely
used for different subjects such as trade promotion, investment promotion, export
promotion, employment promotion, and banking promotion.
In the common sense, “trade” is understood as the buying and selling of goods
and the provision of services, and accordingly, "trade promotion" refers to activities
that promote the purchase and sale of goods and the provision of services. In the
context of integration, commercial activities are formed not only in the relationship
of buying and selling goods and providing services but also including investment
relations and commercial relations in the field of intellectual property. Therefore,


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trade promotion includes promotion of goods purchase and sale, promotion of service
provision, promotion of investment...
In the context of business activities, “trade promotion” is understood as the
process of finding and promoting business opportunities by using different methods
of persuasion to create links with the target market and the public. The objective of
trade promotion is to accelerate the business process and support to achieve maximum
efficiency in business activities. More specifically, according to Huong (2005), trade
promotion is market survey activities, organization and participation in trade fairs and
exhibitions, business matching activities, etc. With this understanding, the evaluation
of trade promotion activities’ effectiveness will only be encapsulated in the number
of businesses that go to market surveys, attend trade fairs, and the number of contracts
signed after each participation in fairs and exhibitions. However, this assessment does
not accurately reflect the effectiveness of trade promotion activities as well as the
allocation of resources of the Government and enterprises for these activities.
According to Clause 10, Article 3 of the 2005 Commercial Law of Vietnam,

“Trade promotion is an activity to promote and seek opportunities to buy and sell
goods and provide services, including promotional activities, commercial
advertising, etc. trade, display and introduce goods and services and trade fairs and
exhibitions”.
Thus, according to the above interpretations, trade promotion is only concerned
with final activities in the production and consumption of goods and services, aimed
at supporting and promoting the purchase and sale of already available goods and
services. on the market. However, the above definition does not explain the role of
government in trade promotion activities today and the reason why trade promotion
has become an important part in the trade development policy of each country.
Therefore, the most comprehensive and complete definition of trade promotion
is provided by the International Trade Centre (ITC), stating that trade promotion
encompasses all measures that can influence, support, and encourage the
development of trade. At the macro level, trade promotion essentially refers to
activities undertaken by the government to support the trade activities of businesses


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and foster the development of the country's trade. At the micro level, trade promotion
encompasses the marketing activities of businesses aimed at achieving their business
objectives.
1.1.2. Concept of information technology application
Information technology (IT) refers to the utilization of computers, storage
systems, networks, and other physical devices, infrastructure, and processes to create,
process, store, secure, and exchange electronic data in all its forms. IT is primarily
employed in the context of business operations rather than personal or recreational
purposes. It encompasses both computer technology and telecommunications with
the purpose of organizing the effective exploitation and use of information resources
which are diverse and potential in all fields of human and social activities.
The term "information technology" was introduced by the Harvard Business

Review to distinguish between specialized machines designed for specific functions
an The IT industry has undergone significant advancements since the mid-20th
century, with a continuous cycle of increasing computing capability, decreasing
device costs, and reduced energy consumption. This trend persists even today with
the emergence of new technologies. In today's world, information technology (IT) is
widely regarded as an essential tool for enhancing the competitive capacity of a
nation's economy. It is now widely accepted that IT has significant impacts on the
productivity of companies. However, these impacts can only be fully realized when
IT is widely adopted and extensively utilized (Oliveira & Martins, 2011).
The Information Technology Law of Vietnam in 2006 provides the definition
that "Information technology is a collection of scientific methods, technologies, and
modern technical tools used for the production, transmission, collection, processing,
storage, and exchange of digital information". The Information Technology Law of
2006 also emphasizes that “Information Technology Applications (ITA) is the use of
information technology in economic, social, external, defense, security, and other
activities to enhance their productivity, quality, and effectiveness”.
It can be affirmed that the application of information technology in businesses
and operations involves utilizing information technology to serve production


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activities, business activities, and management activities, aiming to maximize
resources and optimize operations to generate the highest benefits for the
organizations.
IT encompasses various aspects related to the management and utilization of
technology within an organization. The IT department is responsible for ensuring the
seamless connectivity and functionality of systems, networks, data, and applications.
The IT team typically focuses on three key areas:
- Deployment and maintenance: This involves the implementation and upkeep
of business applications, services, and infrastructure such as servers, networks, and

storage systems.
- Performance monitoring and optimization: IT professionals monitor, optimize,
and troubleshoot the performance of applications, services, and infrastructure to
ensure they operate efficiently and meet the organization's requirements.
- Security and governance: The IT team oversees the security measures and
governance practices associated with applications, services, and infrastructure. This
includes safeguarding data, implementing security protocols, and ensuring
compliance with regulations and organizational policies.
1.1.3. Concept of digital transformation
Digital Transformation plays a crucial role in the 4.0 Industrial Revolution,
however it is challenging to provide a clear and specific definition for digital
transformation because its application varies across different fields. According to Bill
Schmarzo, digital transformation involves applying digital capabilities to processes,
products, and assets to enhance efficiency, improve customer value, manage risks,
and explore new revenue opportunities (Bill, 2017).
According to Vial and Gregory (2019) (Vial, 2019), Digital transformation is
defined as the process of improving an entity by making significant changes to its
attributes

through

the

use

of

information

technology,

computers,

telecommunications, and connectivity. This is an important process not only for
businesses and organizations of all scales and industries but also describes the
activities of an organization or enterprise in leveraging technology to optimize current


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processes and enhance the customer experience, the target beneficiary. The goal of
digital transformation is to maintain competitiveness and readiness to adapt in the
new economy.
Based on the "Guidelines for Digital Transformation for Businesses in
Vietnam" designed by Ministry of Planning and Investment, digital transformation in
businesses can be described as the process of integrating and utilizing digital
technology to improve operational efficiency, enhance management effectiveness,
increase enterprise capabilities, competitiveness, and generate new values. The
Enterprise Project defines digital transformation as the integration of digital
technology across all aspects of a business, leading to fundamental changes in
operations and value delivery to customers. It also emphasizes the need for a cultural
shift that encourages organizations to constantly challenge existing norms, engage in
experimentation, and embrace failure as part of the transformation process.
According to Microsoft, digital transformation is a business innovation driven
by the explosion of cloud computing, artificial intelligence (AI), and the Internet of
Things (IoT), providing new ways to understand, manage, and transform their
business operations. Digital transformation involves the application of digital
technology advancements such as cloud computing, big data, and more into every
aspect of an organization or business, aiming to achieve high efficiency, drive
revenue growth, and enhance the brand.
Digital transformation goes beyond simply changing the way tasks are

performed from traditional manual methods (such as manual record-keeping and
face-to-face meetings) to utilizing technology to minimize human effort. In reality,
digital transformation plays a role in changing business mindset, operational
approaches, and organizational culture. Digital transformation has permeated every
aspect of our lives including many fields such as healthcare, education, finance,
manufacturing, and many others, contributing to the development and progress of
society and the economy.
However, there is often confusion between 'digital transformation' and
'digitalization.' It is crucial to understand that 'digitalization' refers to the