Illustrative image. (Photo: VNA)

Vietnam's innovation ecosystem has gone through a year of ups and downs and to be able to exist sustainably, businesses need to prioritise adapting to the global trends as well as ensure their intellectual property, according to the freshly released "Vietnam Open Innovation Ecosystem Report 2023”.

The report, which was conducted by Vietnam open innovation platform (BambuUP), under the auspices of the National Agency of Technology Entrepreneurship and Commercialisation Development (NATEC) and the National Startup Support Centre (NSSC), pointed out that 2023 was a challenge year for the global economy.

Reports from StartupBlink, Crunchbase and CBInsights showed that by August 2023, total venture investment capital for global startups was 187.6 billion USD, a drop of 46.4% compared to the same period in 2022. On average, 23.4 billion USD was injected into startups each month, a considerable decrease from 37 billion USD in 2022.

2023 also witnessed the decline of leading startup ecosystems. The number of newly appeared unicorns was also at the lowest level in the last four years.

The figures showed that 2023 was a tough year for Vietnam’s businesses. The number of newly-established enterprises in Vietnam grew by 2.3% to 103,658 in the first nine months of 2023, while the number of those leaving the market rose more sharply, by 20.6% to 72,634.

Vietnamese enterprises still face many obstacles relating to innovation, the report said.

About 75% of surveyed businesses said that they were not fully aware of the role of open innovation which resulted in unclear motivation in the implementation.

However, Vietnamese businesses seemed to pay more attention to open innovation as 73% of surveyed enterprises plan to do so in the field of marketing and sales in the future, an increase of 48% compared to 2022. Meanwhile, the research and development (R&D) sector continued to play an important role in innovation plans.

Vietnam ranks 46th among the 132 economies featured in the Global Innovation Index (GII) 2023 rankings, up two positions from last year, according to the World Intellectual Property Organisation (WIPO). Particularly, the country maintained second position among lower middle-income countries in the overall GII after India (40th). Among the Association of Southeast Asia Nations (ASEAN) countries, Vietnam was behind Singapore, Malaysia, and Thailand.

According to WIPO, Vietnam is one of seven middle-income countries that have made the greatest strides in terms of innovation in the last decade. It continues to be one of the three record holders by being innovation overperformers for a 13th consecutive year, along with India and the Republic of Moldova.

However, the organisation pointed out that spending on science-technology and innovation in Vietnam did not see improvement in 2023. The ratio of Vietnam’s investment in R&D to GDP was still low and it is on the decrease.

The Vietnam Open Innovation Ecosystem Report 2023 showed that the ratio was 0.4%, lower than the average level in Southeast Asia, ranking 66th globally, a decline of seven grades from the year before.

Tran Bang Viet - CEO of Dong A Solutions, one of the consultants in the report, suggested that business leaders can change their approaches to facilitate a smooth entry into the new year.

It is essential for businesses to invest in innovation to increase their resilience and they should change their mindset before adopting digital transformation, he said.

He also underlined the need to have customer data, saying it is essential to assist businesses innovate smartly based on connecting existing data values.

Pham Quang Chien, Deputy General Director of Citek Technology JSC, said enterprises need to be more flexible when applying technology, adding that core technology will be the solution to free businesses from the constraints of small-scale and fragmented innovation./.