Institutional Governance, Green Industrial Transformation, and Digital Financial Inclusion: A Comparative Analysis of Indonesia and Vietnam in the Emerging ASEAN Digital Economy

Abstract

This article examines how institutional governance structures shape green industrial transformation, digital financial inclusion, and business resilience in Indonesia and Vietnam within the evolving ASEAN digital economy. The study argues that emerging economies increasingly depend upon institutional coherence linking industrial policy, digital governance, financial inclusion systems, and sustainability-oriented economic coordination to achieve long-term competitiveness and socio-economic resilience. Drawing upon institutional economics, comparative business systems analysis, and innovation governance theory, the article compares Indonesia’s digitally expanding but institutionally fragmented economic model with Vietnam’s manufacturing-oriented and state-coordinated industrial transformation strategy. Empirical analysis utilizes data from BPS Statistics Indonesia, Bank Indonesia, OJK, IMF, OECD, ASEAN digital economy indicators, World Bank governance datasets, and regional industrial competitiveness reports from 2020–2025. The findings indicate that Indonesia demonstrates stronger digital consumption growth, fintech expansion, and platform economy dynamism, whereas Vietnam exhibits stronger industrial coordination, export-oriented technological upgrading, and manufacturing-linked productivity transformation. However, both economies continue to face structural constraints involving labor capability adaptation, sustainability governance inconsistencies, regional inequality, and institutional coordination asymmetry. The comparison reveals that digital transformation alone does not guarantee sustainable development unless supported by adaptive governance systems integrating industrial modernization, financial inclusion, ESG-oriented regulation, and innovation ecosystems. This article contributes to the literature by developing a comparative institutional framework connecting governance capacity, digital business systems, industrial competitiveness, and sustainable socio-economic development in emerging Southeast Asian economies.