ASEAN finds strong growth in its Digital Economy

E-commerce in ASEAN to exceed US$200 billion by 2025

ASEAN is expected to exceed the US$200 billion forecasted e-commerce market value by 2025, which was previously predicted by Google. This is because major e-commerce players in the region, including Lazada, Tokopedia and Shopee are continuously expanding to meet customer demands. 

Additionally, younger customer age group (more young customers), higher disposable income and high mobile internet penetration rate have also contributed to the rapid development of Southeast Asia’s e-commerce market. 

Cybersecurity and Digital Economy 

However, the growing e-commerce market has resulted in more online frauds. In fact, the region is expected to incur a US$260 million loss due to online fraud – with Indonesia, Thailand and Vietnam as the most affected countries.

Other than online frauds, cybersecurity issues like malware and spam mail are also affecting the development of the region’s digital economy. This is especially important as Southeast Asia ramps up its efforts to promote the digital economy.

As such, ASEAN leaders had committed to strengthening their cybersecurity since 2018 – which is reflected in the ASEAN Leaders’ Statement on Cybersecurity Cooperation adopted during the 32nd ASEAN Summit in Singapore. 

Many regional cybersecurity-related conferences such as ASEAN Ministerial Conference on Cybersecurity (AMCC) and ASEAN Telecommunications and Information Technology Ministers’ Meeting (TELMIN) are also being held with the aim to improve the region’s cybersecurity level.

The development of Digital Economy in ASEAN

With the region’s commitment and good practices in cybersecurity, it’s no surprise to see why there’s rapid development in Southeast Asia’s digital economy. This is particularly evident in Thailand and Vietnam.

According to Kiatipong Ariyapruchya, World Bank’s senior country economist for Thailand, Financial Technology (Fintech) growth in Thailand is among the fastest in Southeast Asia at 140 Fintech companies (approximately 50% are new companies). And while only 43% of these companies focus on developing digital transaction services, the Thai government has created organizations and legal frameworks to support the development of digital financial services in the country.

On the other hand, Vietnam aims to become the leading digital economy in ASEAN by 2030, which is submitted in one of the proposals by Vietnam’s Authority of Information Technology Application (AITA). 

Indonesia is expected to introduce new measures to stimulate GDP growth as Jokowi’s second term starts soon – which includes labour, infrastructure and tax reforms.
Due to economic slowdown and strengthening baht, Bank of Thailand had cut its benchmark interest rate to 1.5%. Thailand economy forecasts Thai GDP to grow by 3.3%.
The digital economy in ASEAN is expanding faster than predicted, with the e-commerce market value to exceed Google’s forecasted US$200 billion by 2025.
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