Human capital defines Việt Nam's 2045 economic ambition

Human capital defines Việt Nam's 2045 economic ambition

Việt Nam already benefits from favourable demographics, but the decisive factor will be how effectively it uses both human and physical capital.

Delegates at the media meeting with Professor Andrew K. Rose and NUS Business School in Hà Nội on Thursday morning. — Photo courtesy of the organiser

Việt Nam's ambition to become a high-income economy by 2045 will require a profound shift in its growth model, moving beyond scale and efficiency toward innovation, leadership quality and institutional strength, said an expert from the National University of Singapore (NUS).

Distinguished Professor Andrew K. Rose, dean of NUS Business School, said the country's long-term trajectory hinges on its ability to reframe growth from scale to capability at a time when its economy is becoming increasingly sophisticated.

"To sustain high growth over the next couple of decades, Việt Nam is going to have to move beyond scale, beyond efficiency and invest more so that it can innovate," Rose said, highlighting the needs of high-quality leaders and institutions that support productivity and long-term competitiveness.

Việt Nam has set an ambitious vision for 2045, implying that its gross domestic product (GDP) would need to increase roughly fivefold within two decades. That path would require growth rates of around 10 per cent in the first decade and about 7 per cent in the following one, an unprecedented trajectory by international standards. 

Yet current fundamentals point to structural constraints, particularly in human capital and innovation capacity. Research and development (R&D) spending remains at about 0.5 per cent of GDP, well below the global average, limiting the economy's ability to move up the value chain.

Rose noted that Việt Nam has successfully built an export-oriented economy capable of producing goods and services at scale for both domestic and global markets. The next phase, however, will demand a transition toward designing, innovating and creating new products. International experience shows that technology, applied innovation and management capability are central to such a transformation.

Demographics provide Việt Nam with a critical, but time-bound, advantage. With a relatively young population compared with regional peers and most advanced economies, the country is enjoying a demographic dividend that could underpin growth for decades. 

However, Rose cautioned that demographics alone are insufficient.

"Việt Nam has a window of opportunity. But whether that demographic advantage translates into durable, sustained economic gains depends on sustained investments in skills, leadership and productivity," he said. 

At present, only about 29 per cent of the workforce has received formal training, while roughly 1.6 million young people fall into the 'not in education, employment or training' category, neither in education, employment, nor training. 

While extending working lives may expand labour supply, productivity gains will depend on upgrading skills, particularly digital capabilities, technological application and leadership competence.

Human capital, Rose argued, is the backbone of private-sector competitiveness. Việt Nam's private enterprises have so far leveraged cost advantages effectively, but rising income levels and global competition will require a different foundation.

"Over time, firms will have to rely more on leadership quality, the depth of talent and the ability to innovate and scale in a very complex global environment," he said.

Against this backdrop, NUS Business School sees itself as a long-term knowledge partner for Việt Nam, particularly in developing leadership and management capabilities. Rose said the university's role goes beyond degree education, extending into executive training and lifelong learning.

"At NUS Business School, we think of ourselves as supporting the development of leadership and management capacities so that Việt Nam can convert growth into sustained competitiveness," he said.

"Even after people have graduated, they need continuous training to keep their skills up to date."

He added that non-degree and executive education programmes could play a critical role in upgrading the productivity of Việt Nam's workforce. 

"We are ready to participate in the training process so that Vietnamese human resources can really make the most of their knowledge and skills," Rose said, noting that short courses and executive programmes allow managers and professionals to quickly absorb global best practices in finance, management and innovation.

This emphasis aligns with Resolution 68, which identifies human resources and leadership capacity as central to the future competitiveness of Việt Nam's private sector. The policy prioritises high-quality education, enterprise-led training, tax incentives for reskilling and large-scale leadership development programmes, including initiatives to train thousands of chief executives.

Delegates at the media meeting with Professor Andrew K. Rose and NUS Business School in Hà Nội on Thursday morning. — Photo courtesy of the organiser

The role of human capital is particularly critical for Việt Nam's plan to establish international financial centres in HCM City and Đà Nẵng. Rose stressed that such centres cannot succeed on policy intent alone.

"First, you need a very serious official commitment by the authority," he told Việt Nam News and Law.

"But the second critical ingredient is people. You need a large number of highly skilled professionals who actually want to work and live there."

Globally, only a handful of international financial centres have succeeded, largely because they combine strong regulatory frameworks with high-quality jobs, competitive pay and attractive living environments. 

For HCM City and Đà Nẵng, this means developing not only financial infrastructure and legal certainty but also world-class amenities and a deep pool of talent in finance, management and innovation.

Rose also highlighted the importance of research and development clusters, where universities, government and the private sector interact. 

Drawing on examples from Silicon Valley, Boston and major European hubs, he noted that successful innovation ecosystems typically combine publicly supported basic research with applied research led by firms that translate ideas into commercial products and services.

"To raise research and development, you need to develop the elements of a cluster, with both basic research and a strong private-sector element that turns knowledge into profitable opportunities," he said. 

From a macroeconomic perspective, Rose framed Việt Nam's 2045 ambition around three enduring drivers of growth: people, capital and productivity. Việt Nam already benefits from favourable demographics, but the decisive factor will be how effectively it uses both human and physical capital. 

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