Vietnam fastest growing digital economy in Southeast Asia
Vietnam is the fastest expanding digital economy in Southeast Asia, crossing Indonesia, Malaysia, the Philippines, Singapore, and Thailand, says a report by Google, Temasek and Bain & Company.
The Vietnamese digital economy’s gross merchandise value (GMV) is projected to grow 28% year-on-year to $23 billion this year, up from $18 billion in 2021, bolstered by a 26% year-on-year growth in e-commerce, the report released Thursday notes.
“Vietnam tops the chart as the fastest growing digital economy and the fastest growing e-commerce sector in Southeast Asia,” said Stephanie Davis, vice president of Google Southeast Asia.
Despite the current economic headwinds, the country’s GMV is on course to reach approximately $50 billion in 2025, according to the analysis.
“Fundamentals for Vietnam’s digital future remain solid, thanks to its high quality homegrown tech workforce and growing adoption of digital services across both urban and suburban areas. The growing awareness around environmental, social and governance considerations will help Vietnam and Southeast Asia build a sustainable growth plan for the digital decade,” Davis added.
According to the report, post-pandemic Vietnam is among the countries that are on the fast track to resume its “back to normal” activities. However, some consumer habits and trends that were built and accelerated during the pandemic have remained and continued to grow.
E-commerce is the key driver for the growth of Vietnam's digital economy, and 90% of digital consumers intend to maintain or even further their usage of e-commerce platforms in the next 12 months. Majority of consumers who plan to maintain the same usage across food delivery (up to 60%) and groceries (54%).
Urban digital users are the heaviest adopters of digital services in Vietnam, with e-commerce, food and groceries having the highest adoption rates, up to 96%, 85%, and 85%, respectively.
On the contrary, Vietnamese consume online media content less frequently than what the regional average is, the study showed. Video, music and gaming consumption are all 10-12% below the average consumption. Just 23% of the surveyed people said they watched video on demand at least once a week, followed by 19% for gaming and on demand and 16% for music.
This also shows that Vietnam still has great potential for substantial growth in the long run, the study notes.
Digital financial services continue to flourish in Vietnam. “Digital lending grew the fastest at 114% combined annual growth rate, and investment is projected to take the biggest leap by 2025 with projected 106% CAGR (compounded annual growth rate).”
Moreover, Vietnam tops among the venture capital long-term growth markets, with 83% of VC firms expecting deal activities in the nation to grow in the long term. This ratio is the region’s highest.
“Vietnam’s digital economy will be a hot spot for growth because of its growing population and highly skilled local tech workforce,” said Fock Wai Hoong, deputy head, Technology & Consumer and Southeast Asia, Temasek.
Willy Chang, associate partner at Bain & Company, said: “Vietnam’s digital economy recovered strongly after a delayed impact from Covid in 2021. We expect continued strong growth momentum over the next decade given its high-quality homegrown tech talent pool, significant efforts by the government to accelerate digital transformation across sectors, and investor focus in the country.”
The “e-Conomy SEA 2022” report deep dives into trends and insights of the five mainstay digital sectors, namely e-commerce, online media, transport and food, online media and digital financial services. It covers the state and outlook of Southeast Asia’s technology funding landscape.
In an inaugural section on environmental, social, and governance (ESG) considerations, the report discusses the environmental and social impact of the digital economy and highlights the role of consumers, business, investors and governments in improving environmental and social sustainability.
The Google, Temasek and Bain & Company study says tech funding maintains strong momentum despite investors’ prudent disposition. With a 15% growth in deal value from H1/2021 to H1/2022, technology funding remains robust and Southeast Asia continues to be a hotbed for tech investments, despite investors becoming more cautious in the current macroeconomic environment.
Singapore and Indonesia remain primary investment destinations in 2022, while Vietnam and the Philippines are seeing growing investors’ interest over the longer term.
Google is a global tech giant, Temasek is Singapore’s state investor, and Bain & Company is a global consultancy.
- Read More
Nokia, Viettel deploy 1.2 Tb/s optics transmission in Vietnam, to help 5G growth
Finnish giant Nokia and Vietnamese telco Viettel have rolled out high-capacity optical network after achieving an optics transmission speed record of 1.2Tb a second per wavelength in Vietnam.
Companies - Fri, November 1, 2024 | 3:40 pm GMT+7
Korea SK Group sells 76 mln shares of Vietnam’s Masan, no longer major shareholder
South Korea’s chaebol SK Group has sold 76.28 million shares of Vietnam’s conglomerate Masan, lowering its ownership in Masan to 3.67% of the charter capital and 3.86% of the voting shares.
Companies - Fri, November 1, 2024 | 3:16 pm GMT+7
HCMC-based Bamboo Capital's energy arm fulfils 98% of profit target in 9 months
BCG Energy JSC, a subsidiary of Vietnamese private conglomerate Bamboo Capital Group, posted a consolidated after-tax profit of VND504 billion ($19.94 million) in the first nine months of 2024, fulfilling 98% of the year's profit target.
Bamboo Capital - Fri, November 1, 2024 | 2:32 pm GMT+7
Vietnam refinery operator suffers heavy loss in Q3
Binh Son Refining and Petrochemical JSC (BSR), the operator of Vietnam’s first oil refinery Dung Quat, incurred a net loss of VND1.21 trillion ($47.74 million) in Q3/2024, marking the fourth consecutive quarter of dim earnings.
Companies - Fri, November 1, 2024 | 2:10 pm GMT+7
Vietnam T&T Group, Qatar partner to build $3.2 bln Disneyland park in Hanoi
Vietnam’s conglomerate T&T Group and Qatar’s JTA International Investment Holding will jointly build a $4.5-billion sports and entertainment complex in Hanoi, featuring a Disneyland theme park worth $3.2 billion.
Real Estate - Fri, November 1, 2024 | 12:08 pm GMT+7
AirAsia to collect mandatory carbon fee starting 2025
Malaysia-based carrier AirAsia will begin imposing a mandatory carbon fee on all passengers starting January 1, 2025, according to the country’s Transport Minister Anthony Loke.
Southeast Asia - Fri, November 1, 2024 | 12:05 pm GMT+7
At least seven killed in bridge collapse in Indonesia
At least seven people were killed and dozens of others were injured when a seaside bridge collapsed in the Maluku island region in eastern Indonesia on Thursday.
Southeast Asia - Fri, November 1, 2024 | 12:04 pm GMT+7
Thailand to raise retirement age to 65
Thailand's Labor Ministry plans to raise the retirement age for both private and government sectors to 65 years, the same as in Singapore and Switzerland, according to Labour Minister Phiphat Ratchakitprakarn.
Southeast Asia - Fri, November 1, 2024 | 12:03 pm GMT+7
A quarter of Singapore’s fish farms stop operations in past year
About a quarter of Singapore’s sea-based fish farms have exited the industry over the past year, figures from Singapore Food Agency (SFA) showed.
Southeast Asia - Fri, November 1, 2024 | 12:02 pm GMT+7
Malaysia plans to launch national AI office
The Malaysian Government plans to launch the National Artificial Intelligence Office (NAIO) in Kuala Lumpur on December 12, according to the country’s Digital Minister Gobind Singh Deo.
Southeast Asia - Fri, November 1, 2024 | 12:00 pm GMT+7
Vingroup posts Q3 earnings of $80 mln, highest in five years
Vingroup, the largest private multi-industry conglomerate in Vietnam by ecosystem, recorded a consolidated net profit of VND2,015 billion ($79.54 million) in Q3/2024, the heftiest quarterly earnings in the past five years.
Companies - Fri, November 1, 2024 | 11:54 am GMT+7
Thailand SCG to invest $700 mln more in $5 bln petrochemicals complex in Vietnam
Thailand’s Siam Cement Group (SCG) will invest an extra $700 million in the $5.2 billion Long Son Petrochemicals Complex (LSP) in Vietnam’s southern province of Ba Ria-Vung Tau to diversify its production.
Industries - Fri, November 1, 2024 | 10:20 am GMT+7
Vietnam manufacturing activity rebounds, recovering from typhoon Yagi
The Vietnamese manufacturing sector in October started to recover from the effects of September's super typhoon, recording renewed increases in both output and new orders.
Economy - Fri, November 1, 2024 | 8:34 am GMT+7
Vietnam private lender VietBank logs 96% profit growth in 9 months
Vietnam Thuong Tin Commercial Joint Stock Bank (VietBank) posted a 96% year-on-year surge in pre-tax profit in the first nine months of 2024 to reach VND820.4 billion ($32.46 million), or 78% of the year's target.
Banking - Fri, November 1, 2024 | 7:45 am GMT+7
Maersk opens its first bonded warehouse in Vietnam
Denmark's integrated transport and logistics giant A.P. Moller - Maersk (Maersk) on Thursday opened its first bonded warehouse in Vietnam at SLP Park, Nam Dinh Vu Industrial Park in Hai Phong city.
Industries - Thu, October 31, 2024 | 11:44 pm GMT+7
ABBank incurs $14 mln loss in Q3
Hanoi-headquartered An Binh Commercial Joint Stock Bank reported a pre-tax loss of VND343.5 billion ($13.59 million) in the third quarter of this year, while some other private Vietnamese banks posted strong profits.
Banking - Thu, October 31, 2024 | 9:29 pm GMT+7