ASEAN’s digital economy to be worth $240B by 2025
ASEAN is forecasted to have its internet economy reach $240 billion by 2025 as a result of strong growth in all sectors, including e-commerce, online media, online travel, and ride-hailing, based on the study by Google and Temasek Holdings. This value is 20% higher than the value estimated last year, depicting the sector’s fast growth. This growth was especially sped up by the establishment of new regional startups and new online services like online vacation rentals, online food delivery, video on demand, and subscription music.
The study expects the internet sector in ASEAN to grow over threefold as the industry is estimated to be worth $72 billion this year. Within this value, the gross merchandise value (GMV) for online travel is forecasted to increase from $30 billion this year to $78 billion in 2025. Similarly, the ride-hailing industry is expected to grow from $8 billion in 2018 to $29 billion as local ride-hailing firms like Go-Jek and Grab are growing rapidly.
According to the report, there are over 350 million internet users in Singapore, Vietnam, the Philippines, Malaysia, Indonesia, and Thailand. What’s more, over 90% of people in the region use smartphones to access the internet.
E-commerce takes up the largest share in ASEAN’s digital economy
Out of all sectors in the internet economy in ASEAN, the sector with the largest market size in 2025 is e-commerce. The report forecasts that the GMV of the e-commerce sector in ASEAN will expand from $23 billion this year to $102 billion in 2025.
One reason for this is because of the e-commerce sector’s intensifying competition. For instance, Alibaba Group Holding is making its way into Southeast Asia through Singapore’s e-marketplace Lazada while Sea (previously known as Garena) is continuously expanding Shopee, another major e-marketplace in ASEAN, to other countries in the region.
Vietnam as the fastest-growing digital economy in ASEAN
Out of all the six ASEAN countries it surveyed, Vietnam’s internet economy is forecasted to expand elevenfold, the fastest-growing country from $3 billion in 2015 to $33 billion in 2025. On the other hand, the region’s largest single market is Indonesia with it expected to be valued at $100 billion by 2025. The second largest single market in ASEAN is Thailand at $43 billion in 2025.