Southeast Asia's top digital economies expected to hit $200 billion in 2022, report shows

SINGAPORE — South East Asia's apical integer economies grew faster than expected successful 2022 and is acceptable to scope $200 cardinal successful full worth of transactions made this year, according to a caller study by Google, Temasek and Bain & Company.

The milestone comes 3 years up of earlier projections and is simply a 20% summation from past year's $161 cardinal successful gross merchandize worth (GMV). An earlier study successful 2016 estimated the net system successful the region's six large countries volition adjacent successful connected $200 cardinal successful GMV by 2025.

The six large economies covered successful the study are: Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Vietnam. The study did not code the populations of Brunei, Cambodia, Laos and Myanmar, arsenic good arsenic East Timor and Papua New Guinea.

"After years of acceleration, integer adoption maturation is normalising," said the study released Thursday.

Southeast Asia continues to spot maturation successful the fig of net users — with 20 cardinal caller users added successful 2022, raising the full fig of users to 460 million.

However, that maturation is starting to slow, and was conscionable 4% successful 2022 compared to a twelvemonth ago. That's compared to a 10% year-on-year summation successful 2021 and 11% maturation successful 2020, astatine the tallness of the coronavirus pandemic.

E-commerce continues to thrust the maturation successful the portion contempt the resumption of offline buying arsenic pandemic lockdowns lifted. GMV successful the assemblage grew 16% to $131 cardinal successful 2022.

However, the adjacent 3 years whitethorn spot a slowdown, the study said, projecting maturation successful the assemblage to e-commerce to turn astatine a 17% CAGR from 2022 to 2025.

"E-commerce continues to accelerate, nutrient transportation and online media are returning to pre-pandemic maturation levels, portion question and transport betterment to pre-COVID levels volition instrumentality time," the study said.

Another maturation driver, integer fiscal services, which includes payments, remittances, lending, investments and insurance, person seen steadfast maturation from 2021 to 2022, acknowledgment to offline-to-online behaviour shifts post-pandemic, wrote the report.

Among these services, security recorded the highest, increasing 31% year-on-year portion lending grew 25% year-on-year.

After years of acceleration, integer adoption maturation is normalizing, wrote the aforesaid report. This happens arsenic Southeast Asian economies reopened their borders successful 2022 aft prolonged lockdowns and consumers resumed their buying offline.

In addition, existent macroeconomic conditions specified arsenic surging ostentation rates person impacted Southeast Asian consumers and the integer economy. The study cited rising prices, little disposable income owed to a slowdown, arsenic good arsenic consumers having little entree to products arsenic proviso chains are disrupted portion accumulation backlogs physique up, successful portion owed to China's zero-Covid policies.

Southeast Asia's online system is inactive on way to scope $1 trillion by 2030 arsenic online buying becomes the norm, according to the report.

Overall, the net system successful the six countries is predicted to scope $330 cardinal by 2025 if companies enactment a greater absorption connected profitability for the adjacent 3 years. Some of Southeast Asia's biggest unicorns specified arsenic Grab and Sea Limited person yet to grounds a profit, amassing billions successful losses successful 2021.

All six countries are acceptable to station double-digit maturation successful GMV from 2022 to 2025.

Vietnam is successful the pb and acceptable to station a 31% maturation successful GMV from $23 cardinal successful 2022 to $49 cardinal successful 2025, the study showed. The Philippines is close down with an expected 20% maturation successful GMV, from $20 cardinal successful 2022 to $35 cardinal successful 2025.

There was continued beardown momentum successful investments successful the archetypal fractional of 2022, but investors are becoming much prudent.

"Investors volition beryllium cautious successful the short-term arsenic astir bash not expect a instrumentality to 2021 woody enactment and valuation peaks successful the adjacent mates of years," the study said.

"Nonetheless, astir investors stay bullish successful SEA's medium- to semipermanent potential," but task capitalists stay vested successful the portion with $15 cardinal adust pulverization to prolong deals, continued the report.

"We enactment expanding involvement successful emerging markets, similar the Philippines and Vietnam, and successful nascent sectors, similar SaaS and Web3."

Early-stagers are flourishing, portion late-stage investments are impacted by dim nationalist listing prospects, according to the report.

Singapore-based ride-hailing and nutrient transportation elephantine Grab saw a less-than-stellar banal debut astatine the extremity of 2021 contempt being the largest archetypal nationalist offering by a Southeast Asian institution successful U.S. history.

FinAccel — the genitor of Indonesia's bargain present wage aboriginal level Kredivo — canceled its IPO plans successful October owed to unfavorable marketplace conditions.