Macro and micro lessons for Vietnam

Digitization and social protection: macro and micro lessons for Vietnam

Author/Editor:

Amr Hosny; Alexandre Sollaci



Publication date:

September 16, 2022

Electronic access:

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Disclaimer: IMF Working Papers describe ongoing research by the author(s) and are published to elicit comment and encourage debate. The opinions expressed in IMF Working Papers are those of the authors and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.


Summary:

The COVID-19 shock has highlighted the importance of digital tools to improve the effectiveness and efficiency of social protection systems. Cross-country evidence suggests that digital IDs linked to bank and/or mobile money accounts can improve the delivery of social protection programs and better reach eligible beneficiaries. Using data from Vietnam’s Household Living Standard Survey, we present micro-simulations on the welfare gains of digital social protection during the pandemic. Although digitalization offers opportunities, potential risks must be carefully managed. Vietnam is making progress on individual pieces of the digitalization puzzle, including full digital IDs and mobile money, and the next step is to put those pieces together.

Joel C. Hicks