Vietnam's digital economy is maintaining double-digit growth, driven mainly by e-commerce and online travel, according to a report released recently by Google, Temasek and Bain & Company.

 

The ninth edition of the e-Conomy SEA report "Profits on the Rise, Harnessing SEA’s Advantage" said that Việt Nam’s gross merchandise value (GMV) is projected to grow at a compound annual growth rate (CAGR) of 16 per cent, reaching US$36 billion in 2024, with e-commerce and online travel as the primary growth drivers.

 

Online travel alone is expected to grow 16 per cent year-on-year, reaching $5 billion in 2024, significantly contributing to the overall GMV.

 

Vietnam also leads Southeast Asia in online media growth, with its GMV forecasted to reach $6 billion in 2024 (a 14 per cent CAGR), and anticipated to reach $11 billion by 2030.

 

The ride-hailing market in Vietnam is increasingly competitive, particularly with the emergence of local companies and electric vehicle (EV) options. GMV in transport and food delivery is expected to reach $4 billion in 2024, a 12 per cent increase over the previous year.

 

Marc Woo, Google Asia-Pacific’s Managing Director for Vietnam, said that over the past five years, they have seen strong and steady growth in Vietnam’s digital economy, and 2024 continues to affirm that potential.

 

Vietnamese users have also shown keen interest in AI this year, and it is encouraging to see the Vietnamese government prioritising this sector, he said.

 

The report also highlights strong interest and demand for AI in Vietnm’s urban centres, particularly HCM City and Đà Nẵng, which lead the country in AI-related interest. The education, marketing, and healthcare sectors drive the highest volume of AI searches in Vietnam.

 

The report updates digital economic trends of six Southeast Asian countries, including Indonesia, Malaysia, Philippines, Singapore, Thailand and Vietnam in six fields of e-commerce, food delivery services, transport, online travel, online media and financial services.

 

For the first time, it examines the health of the digital economy through the lens of profit. Key players made significant strides towards profitability, with tighter commissions, targeted incentives, and new revenue streams driving a 2.5 times increase in profits over the last two years. Since 2022, profitability has grown 2.5 times from $4 billion in 2022 to $11 billion in 2024, setting the stage for long-term success.

 

Overall, the report projects that in 2024, the region's digital economy will reach $263 billion in GMV, a 15 per cent increase over last year. Revenues have grown 14 per cent and are projected to reach $89 billion in 2024. This suggests that the digital economy can achieve both profitability and growth in tandem, marking a significant step towards achieving sustainable economic value. — VNS