Business
Vietnam emerged as most digital of all ASEAN economies: Google & Temasek
Vietnam’s internet economy is booming, as it reaches for US$12 billion in 2019 on a 38% annualized growth rate since 2015, and projected to increase to US$43 billion by 2025.
With the gross merchandise value (GMV) of internet economy set to account for over 5% of the country’s GDP in 2019,10 Vietnam is emerging as the most digital of all economies in ASEAN, according to a research report by Google, Temasek and Bain.
According to the report, Vietnam’s Internet economy is booming, as it reaches for US$12 billion in 2019 on a 38% annualized growth rate since 2015, and projected to increase to US$43 billion by 2025.
Overall, the Southeast Asian Internet economy has leapt nearly 40% from last year to exceed $100 billion in GMV in 2019 across the online travel, e-Commerce, online media and ride hailing sectors. The region is on track to hit US$300 billion in 2025, US$60 billion more than previously estimated.
With all sectors taken into account, the GMV of the Internet economy amounted to 3.7% of Southeast Asia’s gross domestic product (GDP) in 2019, up from 1.3% in 2015. It is projected to exceed 8% by 2025. Southeast Asia is closing the gap with developed markets like the US, where the Internet economy had made up 6.5% of the GDP in 2016.
While the region has grown at an average rate of 33% a year since 2015, the two pacesetters in the region are Indonesia and Vietnam, which lead the pack with growth rates in excess of 40% a year.
“e-Commerce is a key driver behind Vietnam’s impressive numbers, where homegrown marketplaces like Sendo and Tiki compete with regional players like Lazada and Shopee,” stated the report.
These dynamics are unlocking opportunities for entrepreneurial Vietnamese small and medium-sized businesses, which have jumped onboard the Internet economy to do business. Investor confidence in Vietnam, the third most-funded economy in the region after Indonesia and Singapore, is on the rise. Over the last four years, Vietnam’s Internet economy has attracted almost US$1 billion in funding, with 2019 in line to be a record year.
Economic growth in ASEAN has averaged 5% a year in the last five years and has exceeded the global growth average by approximately 2 percentage points over the past decade. This is indicative of a stable and rapidly developing region that is on its way to becoming a major economic powerhouse. By 2030, Southeast Asia is expected to become the world’s fourth largest economic bloc.
Source: e-Conomy SEA report 2019.
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Overall, the Southeast Asian Internet economy has leapt nearly 40% from last year to exceed $100 billion in GMV in 2019 across the online travel, e-Commerce, online media and ride hailing sectors. The region is on track to hit US$300 billion in 2025, US$60 billion more than previously estimated.
With all sectors taken into account, the GMV of the Internet economy amounted to 3.7% of Southeast Asia’s gross domestic product (GDP) in 2019, up from 1.3% in 2015. It is projected to exceed 8% by 2025. Southeast Asia is closing the gap with developed markets like the US, where the Internet economy had made up 6.5% of the GDP in 2016.
While the region has grown at an average rate of 33% a year since 2015, the two pacesetters in the region are Indonesia and Vietnam, which lead the pack with growth rates in excess of 40% a year.
Source: e-Conomy SEA report 2019.
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These dynamics are unlocking opportunities for entrepreneurial Vietnamese small and medium-sized businesses, which have jumped onboard the Internet economy to do business. Investor confidence in Vietnam, the third most-funded economy in the region after Indonesia and Singapore, is on the rise. Over the last four years, Vietnam’s Internet economy has attracted almost US$1 billion in funding, with 2019 in line to be a record year.
Source: e-Conomy SEA report 2019.
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