The Politburo’s Resolution No 52 set a goal that Vietnam’s digital economy would make up 20 percent of GDP by 2025.
Bloomberg predicts that Vietnam’s digital economy would have the value of $43 billion by that time.
Lao Dong cited the 2018 report on digital economy in Southeast Asia from Google and Temasek as showing that Vietnam’s digital economy now has the value of $9 billion in four major fields – online tourism, e-commerce, online ads and e-hailing services.
The figure, if compared with the GDP value of $240 billion in accordance with the 2018 price, means 3.7 percent of GDP, a very modest figure.
However, Vietnam ranks second in the region in terms of the growth rate of the digital economy, with 35 percent, just after Indonesia with the growth rate of 49 percent.
It is expected that the value of the digital economy would reach $33 billion by 2025. With the predicted growth rate of 25 percent per annum, Vietnam will continue to rank second in Southeast Asia, just to Indonesia.
|It is expected that the value of the digital economy would reach $33 billion by 2025. With the predicted growth rate of 25 percent per annum, Vietnam will continue to rank second in Southeast Asia, just to Indonesia.|
In 2018, with $9 billion, Vietnam’s digital economy was the smallest among six countries including Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam. By 2025, Vietnam is expected to jump into third position, just after Indonesia and Thailand.
The digital economy in Southeast Asia had the value of $72 billion in 2018 and the figure would be $240 billion by 2025. By that time, with $33 billion, Vietnam’s digital economy would account for 18 percent of the Southeast Asian digital economy.
A report says Vietnam’s forecast economic growth rate would still be high, 7 percent in 2021-2025, while GDP per capita is expected to reach $4,500 by 2025.
Meanwhile, Vietnam’s population is expected to reach 102 million people by 2025. With the predicted GDP per capita, Vietnam’s GDP would be roughly $460 billion by 2025. If Vietnam’s digital economy can obtain the value of $33 billion as predicted by Google and Temasek, the digital economy would account for 7.1 percent of GDP only.
As such, to reach the goal of 20 percent of GDP as set by the Politburo’s by 2025, the digital economy growth rate needs to be three times higher than that predicted by Google and Temasek.
However, analysts noted that Google and Temasek only gave predictions on four sectors of the digital economy. In the next six years, the digital transformation in the socio-economy in general and digital economy in particular may spread out to other sectors as well.
The calculations by Google and Temasek are only in trade and services, and they don’t take into account the value to be brought by digital transformation in production, operation and management.
The banking sector is waiting for the State Bank of Viet Nam to allow the use of electronic know your customer/client (e-KYC).
Vietnam’s internet economy is booming, as it reaches for US$12 billion in 2019 on a 38% annualized growth rate since 2015, and projected to increase to US$43 billion by 2025.