Vietnam's digital economy continues to grow at double digits

According to the e-Conomy SEA report by Google, Temasek and Bain & Company, Vietnam's digital economy continues to grow at double-digit rates.

This is the result of an annual research project initiated by Google, Temase and Bain & Company as a research partner, announced on November 12.

Vietnam's digital economy continues to grow steadily at double digits thanks to e-commerce and tourism

The study found that Vietnam’s digital economy has maintained double-digit growth, driven mainly by e-commerce and online travel. Vietnam’s gross merchandise value (GMV) is expected to grow at a compound annual growth rate (CAGR) of 16%, reaching US$36 billion by 2024, with e-commerce and online travel being the main drivers.

In 2024, the e-commerce industry grew 18% year-on-year, with GMV reaching $22 billion, becoming the main growth driver of Vietnam’s digital economy. In Southeast Asia, the growth of this sector is being driven by video commerce, a model that uses online videos to promote products and make sales. In addition to contributing to GMV and attracting new customers, video commerce has seen rapid growth over the past year. While the full impact of video commerce on long-term customer retention is still unclear, this model offers the potential to build strong relationships with customers and drive long-term brand loyalty. Brands are reaching audiences by collaborating with content creators in more diverse areas beyond their core categories, with many brands even becoming content creators themselves.

In addition to e-commerce, Vietnam’s online travel is expected to grow 16% year-on-year to reach $5 billion by 2024, making a significant contribution to GMV. Online travel continues to generate revenue through increased commission rates per flight, while direct retail channels are the largest contributor to total revenue. This growth is driven by the recovery of travel from Asia Pacific (excluding Southeast Asia), which accounts for 52% of total travel spending in Vietnam.

Online tourism contributes to double-digit growth of Vietnam's digital economy

Vietnam’s online media sector is the fastest growing sector in Southeast Asia. By 2024, the GMV of Vietnam’s online media sector is on track to reach $6 billion, with a compound annual growth rate of 14%, and is expected to reach $11 billion by 2030…

Mr. Fock Wai Hoong, Head of Southeast Asia, Temasek commented. “Vietnam’s digital economy has strong long-term growth potential thanks to strong internal factors such as a young, tech-savvy population and a dynamic startup ecosystem. Temasek is committed to deploying capital to catalyze Vietnam’s digital economy to achieve sustainable and inclusive growth, ensuring prosperity for all generations.”

The research report also said that over the past year, the Vietnamese government has announced an ambitious digital roadmap, which emphasizes AI and semiconductor technology, along with the goal of economic growth and improved public services. This proactive approach by the government has facilitated Vietnam to make significant progress in digital technology despite previous limitations in infrastructure investment. A cashless society is rapidly taking shape in Vietnam, driven by the widespread adoption of digital payments and government initiatives.

The study highlights that Vietnam is rapidly adopting a cashless approach, driven by community initiatives and innovative financial solutions. The development of e-wallets and the widespread adoption of QR code payments have significantly reduced cash transactions. Government initiatives have standardized payment systems and enhanced interoperability, further encouraging the shift to cashless.

Commenting on the digital economy of Southeast Asia and Vietnam, Mr. Andrea Campagnoli, Partner at Bain & Company, said that Vietnam's digital economy continues to be driven by macroeconomic factors, especially with a vibrant and growing startup ecosystem, promising to become a hot spot for AI technology and innovation.

“Over the past five years, we have witnessed the strong and continuous growth of Vietnam’s digital economy, and 2024 continues to demonstrate its potential. Driven by e-commerce, the country’s digital economy has maintained double-digit growth despite the uncertain global economic environment,” said Marc Woo, Managing Director, Vietnam, Google Asia Pacific.

“Vietnamese users have also shown great interest in AI in 2024 and it is encouraging that the Vietnamese Government is prioritizing this area. Google’s commitment to “Building Vietnam, with Google AI” continues to support the growth of Vietnam’s digital economy by helping local workforces and businesses equip themselves with skills and knowledge for the AI ​​era. We are proud to have made a positive impact with initiatives such as the “Google for Startups Accelerator” and most recently the $1 million fund for AI research and development in Vietnam through Fulbright University Vietnam,” said Mr. Marc Woo.

Source: https://thoibaonganhang.vn/nen-kinh-te-so-viet-nam-tiep-tuc-tang-truong-o-muc-hai-con-so-157713.html