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Vietnam Will Lead ASEAN In Digital Economy Growth

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Vietnam Will Lead ASEAN In Digital Economy Growth

24/11/2022

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In October, 2022, the 7th Southeast Asia Digital Economy Report (or the e-Conomy SEA 2022) with the theme “Through the waves, towards a sea of ​​opportunity”, has just been announced. Google, Temasek and Bain & Company worked together to give key updates on the digital economy trends of 6 countries in Southeast Asia, including Indonesia, Malaysia, Philippines, Singapore, Thailand and Vietnam.

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The report analyzes trends in 5 main areas, including: e-commerce; online communication; transportation, food and digital financial services.

E-Commerce leads the Internet Economy: Biggest Contribution – $14 BILLION

This year, the report shows that Vietnam’s Internet economy has the fastest growth rate in Southeast Asia with the total value of goods expected to increase by 28%, from 18 billion USD in 2021 to 23 billion USD at the end of 2022. With a growth rate of 31% in the period 2022-2025, Vietnam’s digital economy will reach about $49 billion by 2025 and reach a record of $120-200 billion by 2030.

Overal digital economy report
Source: Adapted from Google, Temasek and Bain & Company 2022 SEA Digital Economy Report

Of the 23 billion USD in Vietnam’s digital economy in 2022, the e-commerce sector has the largest contribution with 14 billion USD. In addition, other fields such as online travel, transportation and food, audio-visual services, although still accounting for a modest contribution to the digital economy, also had a strong growth rate in the year 2022. Especially, the online tourism sector, after being heavily affected by the Covid-19 epidemic with a negative growth rate (-56%) in the period of 2019-2021, in 2022, it has rebounded with a high growth rate of up to 153% (reaching 2 billion USD).

Meanwhile, Indonesia is the leading country in digital economic development with an increase of 22% compared to 2021 (reaching 77 billion USD). Other countries such as Malaysia increased by 13% (reaching 21 billion USD); Philippines increased by 22% (reaching 20 billion USD); Singapore increased 22% (reaching 18 billion USD); Thailand will grow by 17% (to reach 35 billion USD) in 2022.

Vietnam Expects Long-term Market Growth Of Investment Funds

Urban digital users in Vietnam have the highest adoption of digital services, with e-commerce, transportation services and food delivery topping the list with a ratio of 96%, 85% and 85% respectively.

Source: Adapted from Google, Temasek and Bain & Company 2022 SEA Digital EconReport

On the other hand, the frequency of a Vietnamese person consuming digital content is lower than the regional average, with 23% of survey respondents saying they watch video on demand at least once per week, followed by 19 % for online gaming and 16% for on-demand music. This shows that Vietnam still has a lot of growth potential in the long term.

Digital financial services continue to thrive in Vietnam. Digital financial services are expected to grow dramatically, with lending rising sharply at around 56% and digital investments to leapfrog after 2025. Specifically, the lending sector achieved the fastest compound annual growth rate at 114%. The investment sector is going to take the biggest leap in 2025 with a compound annual growth rate of more than 106%. Meanwhile, the fields of payment and money transfer also had good growth rates of 21% and 31%, respectively.

Vietnam Focuses On Training High-quality Human Resources for Future High-tech Developments

In order to adapt to the fast-paced technological trends of the world and the South East Asia region, it is extremely important for the Vietnamese people to be ready for a full digital transformation on a national scale

On October 19, the Ministry of Education and Training organized a seminar on the needs and policies of training high-quality human resources for high-tech development (Project). The seminar was chaired by the Director of the Higher Education Department Nguyen Thi Thu Thuy, with the participation of many experts inside and outside the Education sector.

The Project initial identified its target of (a) rapidly increasing the number of qualified technicians and IT engineers by 2030 (b) creating a spill-over effect for overall economic development (c) putting Vietnamese technology institutions on global-ranking lists. According to Mrs. Nguyen Thi Thu Thuy, training the Vietnamese labor force to be ready for a new age of technological advancements is a top priority for not only the Ministry of Education, but for all educators as well. With that, the future holds so many opportunities for the Nation, the only thing left for Vietnam to do is to seize them.