From March 11 to 25, Vietnamese and World Bank (WB) experts will host a discussion on higher education and innovation – driving force for Vietnam’s development toward 2035.

International experiences show that innovation is critical to both growth and the concomitant creation of new and better jobs. More generally, both theory and history suggest that countries can have very different growth trajectories depending on their ability to identify and assimilate technological advances.

Over the past decades, Vietnam’s impressive growth has relied heavily on the accumulation of capital and labor. More people started working and companies invested in machinery and other capital. These gains cannot continue to grow as they have in the past. Future economic growth must rely increasingly on increasing productivity.

The single most important driver of total factor productivity (TFP) as well as productivity in general is innovation, more specifically, technology-driven innovation. In agriculture, for example, R&D results applications have contributed up to 30% of growth in the sector.

Boost innovation requires mobilizing financial sources and improving the performance of the national innovation system (NIS). The NIS is made up of the firms, research institutes, universities, and public and private agencies that produce knowledge and research, advance technology or commercialize it.

State budget remains the key source of investment in science, technology and innovation (STI), i.e. 65 – 70% of total social investment in STI, and yet STI expenditures account for 1.5% of total State budget. Industry does not invest in R&D in ways that optimize growth.

Human resources for STI – a key to the development of innovation – are scarce and often not of sufficient quality and relevance.

The skills supplied through formal education and training are often out of date or too theoretical, and do not meet the demands of the labor market. In addition to financing constraints, the governance of higher education suffers from weaknesses in terms of information about skills needs and incentives for alignment.

There is a weak linkage between universities and institutes, between research institutes and the industry sector, poor quality of scientific research and social service providers, unsound policy and mechanisms, and weak structural system of human resource training.

VOV