Vietnam’s digital economy is projected to hit $220 billion in gross merchandise value (GMV) by 2030, placing the country second only to Indonesia in the region, according to the e-Conomy Southeast Asia (SEA) Report released today by Google, Temasek and Bain & Company.
|Vietnam’s internet economy will be the second-largest in Southeast Asia within 10 years |
This year, Vietnam’s digital economy is expected to grow by 31 per cent to $21 billion, bolstered by a 53 per cent growth on-year in e-commerce despite the shrinking online travel market, and hit $57 billion by 2025.
Since the start of the pandemic through the first half of 2021, Vietnam has seen eight million new digital consumers, more than half of whom come from non-metro areas. Pre-pandemic digital consumers use an average of four more digital services since the pandemic began, while overall 99 per cent of Vietnam's digital consumers intend to continue using online services going forward, indicating an overall stickiness in digital adoption.
Furthermore, digital financial services are also becoming critical enablers, with 99 per cent of digital merchants now accepting digital payments and 72 per cent adopting digital lending. Seven out of 10 digital merchants expect to increase their usage of digital marketing tools in the next five years.
Vietnam remains an attractive innovation hub as global capital continues to pour into the country as deal activity skyrocketed in the first half of 2021 to hit a record high of $1.37 billion, surpassing full-year investments of recent years fuelled by interest in digital services startups in e-commerce, fintech, healthtech, and edtech.
“Through the pandemic, I have witnessed first-hand how resilient the people in Vietnam are and how they can become fast and creative adopters of new technologies. This freshly adjusted forecast on Vietnam's internet economy by 2030 shows us the great potential of the country once Vietnam accelerates its digital transformation. Google's latest projects such as ‘Accelerate Vietnam Digital 4.0' and ‘Coding for the Future' that effectively provided digital skills training, coding sessions for close to one million people in Vietnam is a tangible proof of our commitment in supporting the country on its digital growth journey,” said Tram Nguyen, Google country director for Vietnam.
Providing a 10-year outlook, the 2021 e-Conomy Southeast Asia report highlights that the region is on the path to become a $1 trillion digital economy by 2030, of which Vietnam could record $220 billion in GMV. Propelled by a fast-growing base of digital consumers and merchants, acceleration in e-vommerce, food delivery, and digital financial services, the region is estimated to reach $174 billion in GMV by the end of 2021. This number is further expected to surpass $360 billion by 2025, outgrowing the earlier projection of $300 billion.
The report predicts that Southeast Asia, including Vietnam, is entering its "digital decade" as the internet increasingly becomes an integral part of consumers’ daily lives. The region now has more than 440 million internet users, and importantly, 350 million of them are digital consumers, that is, internet users who have bought at least one online service.