A study by Google and Temasek, a Singaporean holding company owned by the Government of Singapore, said that Vietnam’s Internet economy is the largest in Southeast Asia this year, in terms of gross merchandise volume (GMV) relative to GDP. According to the study, which encompassed e-commerce, online media, online travel and ride-hailing services, Vietnam’s gross merchandise volume (GMV) traded over the Internet equals 4% of the country’s GDP.
In second place in the Google / Temasek study was Singapore with a GMV rate of 3.2%. The study covered Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Vietnam and also found that Indonesia’s digital economy had the fastest absolute growth and looks set to reach $100 billion in 2025.
Since 2015 / 2016, online businesses have been booming in Vietnam. The Vietnam E-Commerce Association reported that in 2017 that Vietnam’s digital economy grew by more than 25%, a rate that can be sustained for the next two or three years. It said that online sales are set to hit $10 billion by 2020, and will account for 5% of retail sales by that time.
Bain, the U.S.-based global management consulting firm, estimated in April that Southeast Asia has 200 million digital consumers that bought goods or services online, out of an adult population of 405 million. Vietnam, with a population of 93.7 million, accounted for 35 million of those digital consumers.
Vietnam’s youthful population is among the keenest users of mobile devices in the region, while the country’s consumers spend more time online than most of their neighbors. Research firm Nikkei estimates that Vietnamese spend nearly 25 hours online per week, on a par with or just behind Singapore and the Philippines.
Experts say Vietnam and many countries in the Southeast Asia region face a variety of challenges in the digital economy including banking and payment systems, logistics and delivery and human resources and that Vietnam has the potential to be one of the strongest players in e-commerce if the country continues to make investments into technology and people.