In the past few years, issues related to MSME innovation have been increasingly featured in policy dialogues in Vietnam. Vietnam’s has recently jumped from low to lower-middle income, and policy makers are now facing questions about avoiding the “middle-income trap” and generating economic growth without increased exploitation of natural resources and cheap labour that would result in deteriorating environmental and social standards. Focusing on using innovation for MSME growth will help achieve this goal.
While Vietnam is an economy with high growth potential, several major barriers to MSMEs’ innovation continue to persist, such as limitations in its ability to scale and capacity for technology absorption. Considering the best practices identified, this research report includes several recommendations to promote innovation and MSME development in the country. Concurrently, generalizations are made to other related developing country contexts across the APEC region.
Conducted by Lan H. Phan, Hieu M. Tu, and Thomas Borgert, this research report is one of three published for the APEC-Canada Growing Business Partnership around the theme of technology and innovation, with a focus on Vietnam and other APEC economies.