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Viet Nam’s Internet economy to become second largest in Southeast Asia by 2030

VGP – Viet Nam’s digital economy is projected to hit US$$220 billion in gross merchandise value (GMV) by 2030, placing the country second only to Indonesia in the Southeast Asian region.

11/11/2021 16:55

The statement was announced in the Google, Temasek and Bain & Company’s sixth edition of the e-Conomy Southeast Asia (SEA) Report-Roaring 20’s: The SEA Digital Decade, which was released on November 10.

This year, Viet Nam’s digital economy is expected to grow by 31 percent to US$21 billion-bolstered by a 53 percent year-on-year growth in e-commerce despite the shrinking online travel market-and hit US$57 billion by 2025.

Since the start of the pandemic through the first half of 2021, Viet Nam has seen eight million new digital consumers with more than half of them coming from non-metro areas.

In Viet Nam, Digital financial services are becoming critical enablers, with 95 percent of digital merchants now accepting digital payments and 67 percent adopting digital lending. Further, seven out of 10 digital merchants expect to increase their usage of digital marketing tools in the next five years.

Viet Nam 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 US$1.37 billion, surpassing full year investments of recent years fueled by interest in digital services startups in e-commerce, fintech, healthtech and edtech.

Viet Nam’s internet economy continues to attract global capital because of its strong growth fundamentals such as a large base of highly engaged digital users and its growing digital ecosystem of incubators, accelerators and innovation labs, said Rohit Sipahimalani, Chief Investment Strategist and Head of South East Asia at Temasek.

Meanwhile, Florian Hoppe, Partner and Head of Digital Practice in Asia-Pacific at Bain & Company said that Viet Nam holds the potential to become the region's second largest economy at close to US$220 billion with strong investor interest and as more of its non-metro populations come online.

To accelerate growth in the digital decade ahead, Viet Nam must continue to invest in momentum drivers and critical enablers such as digital payments and talent development, he added.

By Thuy Dung