Vietnam's Rapid E Commerce Growth and Digital Economy Transformation

Vietnam's e-commerce sector and digital economy are experiencing remarkable growth, serving as dynamic drivers for economic transformation and global engagement in Southeast Asia. According to a recent meeting held in Ho Chi Minh City by the Ministry of Industry and Trade’s Trade Promotion Agency and the city’s Investment Trade Promotion Centre ITPC, online sales within Vietnam are projected to reach $30 billion by year- 2024.

The meeting highlighted that major e-commerce platforms generate approximately US$ 31.65 million in sales dly, reaching nearly VN$ 800 billion $30 billion per day from the top five e-commerce sites alone. These platforms reported a significant surge of VN$ 143.9 trillion in sales during the first half of 2024, marking a year-over-year increase of 54.91 compared to the retl sector's growth rate of 7.4.

However, despite impressive e-commerce achievements, Vietnamese brands accounted for only one position among the top revenue-generating e-commerce platforms excluding the top five, with Vinamilk being that brand. This indicates a need for domestic businesses to refine their strategies and compete more effectively in Vietnam's dynamic online market.

As the academic year approaches in August and early September, demand for affordable school supplies is expected to increase significantly. Meanwhile, robust growth has been observed across various shopping methods, especially social media live-streaming commerce and multi-channel sales, which have become significant revenue contributors to sellers.

Ho Thi Quyen, Deputy Director of ITPC, underscored the importance of digital skills for businesses to enhance their brand development and market expansion potential. She highlighted that tools like social media platforms, livestreaming, and eml marketing are crucial for optimizing business management and operations.

Le Hoang T, Deputy Director of the Trade Promotion Agency, emphasized the need for companies to develop new business skills aligned with current trs to seize opportunities provided by digital platforms effectively. The agency plans to collaborate with partners to support businesses in promoting trade through digital platforms and fostering the agricultural digital economy. These efforts will involve providing access to new technologies and assisting businesses in expanding their market presence.

Vietnam is strategically advancing its digital economy and e-commerce sectors both nationally and globally, with a focus on expansion and consolidation. The government's strategic initiatives include supportive policies med at enhancing market reach and operational efficiency through digital transformation.

Vietnam has emerged as the third-largest e-commerce market in Southeast Asia alongside Thland, surpassing the Philippines. In 2023, the gross merchandise value GMV of Southeast Asia’s top e-commerce platforms reached $114.6 billion, a growth of 15 compared to the previous year. Vietnam and Thland experienced GMV growth rates of 52.9 and 34.1, respectively.

Under Prime Minister Pham Minh Chinh's directive, regulations have been streamlined and digital security enhanced, demonstrating Vietnam's commitment to modernizing its digital economy. Collaborating with various government agencies, localities, and the private sector, the government is accelerating efforts to develop cross-border e-commerce as a core economic driver. This initiative is leveraging digital transformation to promote exports and ensure that Vietnamese businesses thrive globally.

Over the last five years, Vietnamese small and medium-sized enterprises SMEs have significantly increased their global reach by 300, exporting products through international e-commerce platforms. The B2C e-commerce export revenue of Vietnam is anticipated to hit $13 billion by 2027.

Vietnam enhance its global presence and strengthen its digital reputation with government policies that support cross-border e-commerce, which is growing at a rate twice as fast as regular e-commerce and is forecasted to grow annually by 20 until 2026.

The government has improved legal frameworks, provided financial assistance, and advanced digital infrastructure improvements while organizations like VECOM and AGSV provide support for businesses in the global e-commerce space.

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? 2024 OpenGov Asia – CIO Network Pte Ltd
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