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Vietnam’s fast-growing digital economy is likely to help the country become a high-income economy by 2045, according to an article established on eastspring.com on February 10.
Namely ‘Vietnam’s digital boom to lift the economy’, the article noted while there will be challenges to overcome, such development will also present many opportunities for investments across sectors.
The article also wrote Vietnam’s middle-income class earning above 700 USD a month is estimated at one third of the population and expected to double its size by 2030. Such growth will underpin domestic consumption for services and higher value-added products, it said. “As the young middle class are ever ready to embrace new trends such as digitalisation and sustainability, this will likely present new investment opportunities in financial services, information technology, consumer goods and green products.”
The author continued to say that digitalisation is becoming an integral part of consumers’ daily life in Vietnam. The country’s digital economy is growing by double digits and the total market value is expected to hit 57 billion USD in 2025. Vietnam’s digital market is fast growing driven by strong growth in e-commerce, fintech, and education.
The article said with increasing internet penetration, wider adoption of smartphones and various online shopping platforms, the e-commerce market is expected to generate a higher growth of 25 percent per annum and have a market value of 35 billion USD by 2025 – one tenth of total retail sales according to the country’s long-term vision. An increasing number of foreign investors have been seeking investment opportunities in many Vietnamese e-commerce platforms. Vietnam’s e-commerce, boosted by the digitalisation trend and compounded with fast growing funding, is on track to achieve high growth rates.
The author noted the financial services are capitalising the digitalisation trend in Vietnam. Following the State Bank of Vietnam’s plan for digital transformation by 2025, the industry has been designated to take a pioneering role in establishing an entirely digitalised, human-centered system. Given this, Vietnamese banks are pursuing notable strategies for digital development.
The article added that active users of select banking apps in Vietnam recorded a growth of 73 percent on-year in the first nine months of 2020, which is the highest region wide. It also stated there is plenty of room for growth in the nation’s digital financial services over the coming years.