Green Transition in a Digital Era - Ho Chi Minh Autumn Economic Forum
Keynote Remarks at the Ho Chi Minh Autumn Economic Forum by Ms. Pauline Tamesis, UN Resident Coordinator in Viet Nam
- Excellency Mr. Pham Minh Chinh, Member of the Politburo, Prime Minister of the Socialist Republic of Viet Nam;
- Excellencies and Distinguished Distinguished Delegates
Good morning. I start with a quote from the UN Secretary General, António Guterres, who said --
"The future is being built in the cloud. It must be powered by the sun, the wind, and the promise of a better world."
This quote captures what green transition must look like in a digital era.
We stand at a unique and defining moment in history. In the ten years since the Paris Agreement was adopted, renewable energy technologies have undergone a remarkable transformation -- paving the way for rapid and widespread transition from energy systems dominated by fossil fuels to homegrown, low-cost renewables.
If we follow the money, we see that and I quote the UN Secretary General, “the sun is rising on a clean energy age,” with “USD2 trillion going into clean energy last year – USD800 billion more than fossil fuels, and up almost 70% in ten years.”
What we are seeing in the energy transition is “not just a shift in power… but a shift in possibility … in repairing our relationship with the climate.”
For the UN, the transformation is fundamentally about energy security and people’s security. It’s about smart economics. It’s about decent jobs, public health, advancing the Sustainable Development Goals. And delivering clean and affordable energy to everyone, everywhere.
Digital technologies, at the same time, are fundamentally changing the way we live, consume, entertain and relate to each other. Two billion people shop online with e-commerce platforms. Three billion people play online video games. Four billion are connected on social media.
The numbers are impressive. Digital transformation is now a structural driver. Digitization is a central economic force, reshaping jobs, industry and services. Access to digital infrastructure is key to unlocking economic and social opportunities. Many nations now prioritize digital transformation, through infrastructure, technology, and regulation, to secure future prosperity.
Our greatest collective challenge, however, is connecting these two transformations into a twin transition: the simultaneous shift toward a green and a digitally enabled economy. These two transitions reinforce, shape, and increasingly depend on one another.
We are already witnessing green transition and climate actions powered by digital technologies that improve climate modelling, resource efficiency, and energy management. At the same time, the digital transition must be powered by clean, sustainable energy.
Countries that align climate ambition with digital innovation are strengthening competitiveness, reducing vulnerabilities, attracting investment, and creating high-quality jobs. For Viet Nam, this twin transition represents a major strategic opportunity to sustain high growth, deepen resilience, and move up the value chains.
What are the regional and global shifts shaping green and digital transformations? I cite 3:
First, climate action is changing rapidly because of advanced data systems and Artificial Intelligence (AI). These are used to create more accurate climate modelling to improve disaster prediction and early warning.
At the same time, digital technologies can increase emissions due to rising energy demand. In the adoption of the Global Digital Compact, member states acknowledged that digital cooperation must support environmental sustainability across the entire lifecycle of technologies, from production to use to disposal.
What does this mean for Viet Nam? UN ESCAP identifies Viet Nam as one of the Asia–Pacific region’s most climate-vulnerable economies. The World Bank calculated that Viet Nam lost USD10 billion in 2020 (or 3.2% of GDP) to climate change. Stronger early-warning systems for storms, floods, and landslides can reduce this cost.
Second, digitalization is transforming energy systems globally
Digital technologies evolve electricity grids from one-directional systems into responsive, multi-directional energy networks. Smart meters, sensors and AI-enabled control systems improve real-time balancing, reduce losses, and increase reliability.
Across the world, households and firms generate their own power through rooftop solar, batteries or mini-grids. Digital platforms are essential to coordinate two-way power flows and integrate distributed renewable energy efficiently.
In Viet Nam, Resolution 70 offers starting points to leverage digital transformation for modernizing the energy system. Viet Nam aims to develop a national energy information system and database. This is the foundation for data and AI-driven energy planning and forecasting.
Resolution 70 also aims for rapid growth in rooftop solar for self-consumption and energy storage. This will require regional interconnection and require smarter, digitally enabled grid management.
Third, the world faces the risk of an unsustainable (dirty) digital transformation.
The digital sector’s environmental footprint is expanding quickly: data centres, crypto mining and AI computing often rely on fossil-based electricity. A typical AI data data-center eats-up as much electricity as 100,000 homes, and by 2030 data centers will consume as much energy as Japan.
Global concerns are also rising about e-waste, mineral extraction and labour conditions in digital supply chains. Only 22.3% of e-waste is formally collected and recycled in an environmentally sound manner. Often waste is imported to Southeast Asia and the Middle East under misleading trade codes with severe environmental impact.
Further, efficiency gains risk triggering “rebound effects,” where increased consumption outweighs sustainability benefits. This reinforces the need for responsible digital policy and regulation.
[PAUSE]
To bring the vision of accelerating green transition and leveraging digital technologies as dual engines for inclusive, resilient and sustainable growth in Viet Nam, the UN, together with the Government, embarked on a macro modelling exercise.
The modeling specifically measured impacts of government investments in renewable energy, digital infrastructure and social sectors on GDP growth, poverty rate and CO2 emissions.
The findings from our joint study make a compelling case for accelerating green transition in a digital era.
How? Three key findings:
One, investing in renewable energy would likely help Viet Nam to achieve the targets for renewable energy development, reducing CO2 emissions and improving air quality, as well as economic growth. In view of the huge value of investments involved, there would likely be a surge in public debt, however, if the investments were to be financed mainly by the Government.
Two, investing in human capital and energy efficient infrastructure has positive economic and social effects. These drive GDP growth, reduce poverty and inequality, reduce CO2 emissions and pollution, and improve the government’s fiscal space. The study shows that GDP growth benefits of investing in people and green infrastructure are greater than potential government debt increase.
Third, investing in information, communication and technology (ICT) infrastructure (or digital transformation) has a positive effect on GDP growth (by at least 2%) as well as on poverty reduction and inequality.
The modelling demonstrates the importance of inclusive fiscal policy in support of the achievement of the Sustainable Development Goals. The most fundamental is the need to maintain adequate public spending on three major development areas – health, education and social protection. Enhancing the access to, and the quality of, these public services will directly benefit vulnerable populations, including people living in remote, ethnic minority regions -- areas frequently affected by climate-related disasters -- and thus promote socioeconomic equality in the long term. It also shows that the pressures on the government’s fiscal space subside over time because the economic and development benefits outweigh the costs.
While financing is the key means of implementation, a predictable and integrated policy framework, as well as investments in skills development and enabling infrastructure are critical.
Through an integrated policy framework, that breaks down the silos between green and digital transitions, Viet Nam can set predictable, clear policy targets. It can harmonize policy instruments such as fiscal incentives. It can also ensure robust inter-ministerial coordination. The nationally determined contributions (NDC 3.0) can be a good starting point for policy alignment.
Meanwhile, with Viet Nam rapidly approaching upper-middle-income country status, it will need to increasingly rely on domestic resources and private capital to finance its development needs. With the growing economy, the country can enhance tax revenue collection and progressiveness while adopting innovative and blended finance models. Reforming domestic capital market is necessary to enhance its role in attracting international capital and channeling domestic savings into digital and green sectors.
The macro-modelling underlines that navigating a balance between prudent public debt management and achievement of long-term development goals is essential. How investments in development priorities are financed in terms of size, composition and pace has a direct impact on public debt. This emphasizes the importance of calibration of the financing strategy, approach and mobilization of various sources of finance, including private capital.
As Viet Nam continues on its path of economic development and integration, and with the country’s rise to the new era, the UN appreciates that the insights gleaned from this study already served as an input to the 14th Party Congress deliberations.
During the recent visit of the UN Secretary General to Hanoi – he advised that in a dynamic and rapidly growing Viet Nam, the UN should become a “laboratory” for the twin green and digital transformations. He himself will be very keen to learn from our experience – how Viet Nam’s future is being built in the cloud, while being powered by the sun, the wind, and the promise of a better world.
Xin cam on!