1. Introduction: The Digital Economy at an Inflection Point

AI and digitalization are transforming economies, with Korea and Vietnam at a critical juncture. Their ability to navigate changes in technology, market structures, regulations, and behavioral adaptation will shape future economic trajectories. AI has emerged as a General-Purpose Technology (GPT), expected to be a key driver of productivity growth across industries. Its integration into various sectors will accelerate automation, enhance decision-making, and enable new business models, fundamentally reshaping economic landscapes.

2. Technology: The Driving Force Behind the Digital Economy

AI is revolutionizing industries through automation and intelligent decision-making. As a GPT, AI’s widespread adoption is leading to exponential improvements in efficiency, innovation, and competitiveness. Scaling Law has driven rapid AI advancements, but data and compute bottlenecks threaten its sustainability. Nvidia’s dominance has intensified semiconductor investment, with Korea aiming for AI chip leadership and Vietnam expanding cloud infrastructure. Meanwhile, Deepseek’s emergence challenges Scaling Law, raising questions about future AI development strategies.

Korean companies, particularly Samsung, LG, and SK Group, have played a pivotal role in Vietnam’s economic growth, investing heavily in manufacturing, electronics, and R&D. As AI reshapes industries, these companies are expected to continue driving Vietnam’s digital transformation, particularly in semiconductors, AI-powered devices, and cloud-based services.

3. Digital Transformation: Korea vs. Vietnam

Korea is a global leader in digital transformation, driven by advanced AI adoption, a strong semiconductor industry, and cutting-edge infrastructure in 5G, smart cities, and AI-driven automation. Government initiatives promoting data sharing and transactions, along with substantial investments in AI R&D, have positioned Korea at the forefront of digital innovation.

Vietnam, while still in an earlier stage of digital transformation, is experiencing rapid progress in e-commerce, fintech, and digital payments, driven by a young, tech-savvy population and a growing digital economy. The Vietnamese government has launched initiatives such as National Digital Transformation Program 2025, aiming to accelerate AI adoption and expand cloud infrastructure. AI is set to further accelerate Vietnam’s digital transformation, enabling productivity gains in manufacturing, logistics, and financial services while fostering a more connected economy.

4. Market Dynamics and Institutional Responses

AI-powered business models are reshaping competition. Korea’s tech giants leverage AI, while Vietnam fosters fintech and digital trade. Market concentration and fair competition remain key concerns. Regulatory challenges persist as Korea enacted the Basic Law on AI, while Vietnam refines its cybersecurity and innovation policies. Korea’s firms will likely play a key role in supporting Vietnam’s AI infrastructure and workforce development, strengthening bilateral digital cooperation.

5. Behavioral and Policy Implications

AI is altering consumer behavior and workforce dynamics, necessitating upskilling initiatives. Governments must balance innovation with risk through strategic policies. Korea and Vietnam are positioning themselves to capitalize on AI compute demand—Korea advancing semiconductor R&D and Vietnam developing cloud infrastructure—to strengthen their roles in the global digital economy.

6. Conclusion: The Need for Adaptive Policies

The digital economy is at a crossroads. Korea and Vietnam must proactively manage AI’s impact, fostering innovation while ensuring regulatory balance. AI as a GPT will be a fundamental force shaping future economic competitiveness. Korean companies’ continued investment and leadership in AI-driven industries will be crucial for Vietnam’s digital future. Collaboration between policymakers, businesses, and researchers is essential for a sustainable AI-driven future.