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Vietnam’s digital economy may reach US$45 billion by 2025: report

By Dat Thanh

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HCMC – Vietnam’s digital economy is expected to gain robust growth and reach an estimated US$45 billion by 2025, according to a joint report by Alphabet, Temasek Holdings, and Bain & Company.

This projection entails an annual growth rate of 20% from 2023 to 2025, primarily driven by expectations of strong economic growth.

Despite these projected figures being US$4 billion lower than the 2022 edition report, which foresees Vietnam’s digital economy taking the lead in Southeast Asia with annual average growth of 31% and reaching US$49 billion by 2025, Vietnam’s digital economy is still poised for significant growth.

The report underscores the rising popularity of digital payments, especially through QR codes, which are gaining prominence with support from the Government and investments from commercial banks.

Vietnam’s central bank is actively promoting cashless payments in rural areas. The report underlines the need for digital companies to demonstrate clear pathways to profitability in order to attract investments.

Many digital businesses are successfully shifting focus towards monetization to meet profitability targets. Digital payments now account for over 50% of the region’s transaction value.

Despite fluctuating export demand, Vietnam’s manufacturing and export sectors are seen as essential for growth. The report emphasizes the importance of securing public investment to address infrastructure constraints, with wages and employment also playing a pivotal role in shaping the digital economy’s trajectory.

The tourism sector in Vietnam is expected to gain full recovery this year, primarily driven by the rapid growth in domestic travel. New airlines and an increase in international routes have contributed to this recovery.

The report concludes that Vietnam’s digital economy is not only fostering economic growth but also creating new employment opportunities and enhancing the lives of its citizens.

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