Vietnam’s Booming Internet Economy

Posted by Written by Koushan Das Reading Time: 4 minutes

Vietnam’s internet economy in 2018 is expected to reach US$9 billion in gross merchandise value (GMV), accounting for around four percent of the GDP, according to a recent study by Google and Temasek Holdings on Southeast Asia.

Internet economy in Vietnam which covers, online travel, e-commerce, online media, and ride-hailing, grew at a compound annual growth rate (CAGR) of 38 percent between 2015 and 2018.

Internet economy in Vietnam

The internet economy in Vietnam is predicted to grow at a CAGR of 25 percent between 2015 and 2025, from US$3 billion in 2015 to US$9 billion in 2018 to US$33 billion by 2025. Largely driven by the growing number of internet users and increase in adoption, the e-commerce sector almost doubled in 2018 compared to the previous year, while gaming and online advertising grew more than 50 percent.


Since 2015, Vietnam’s e-commerce market size (GMV) has grown swiftly at a CAGR of 87 percent to US$2.8 billion in 2018. By 2025, it is forecast to reach US$15 billion.

Online media

The online media market which covers online advertising, gaming, subscription music, and video on demand has grown from US$600 million in 2015 to US$2.2 billion in 2018, at a CAGR of 57 percent.

By 2025, this number is expected to reach US$6 billion.

Online Travel

Online travel includes online bookings and online vacation rentals. This segment grew at a CAGR of 15 percent from US$2.3 billion in 2015 to US$3.5 billion in 2018.

By 2025, the market will continue to grow at a similar pace and reach US$9 billion.


The ride-hailing, and food delivery segment has grown from US$200 million in 2015 to US$500 million in 2018, at a CAGR of 41 percent. By 2025, the market is expected to grow fourfold compared to 2018 to US$2 billion.

Regional comparison

In addition to Vietnam, the study also covers countries such as Indonesia, Malaysia, the Philippines, Singapore, and Thailand. The region accounts for over 350 million internet users. In addition, more than 90 percent of the region’s population is connected to the internet through their smartphones, making it one of the largest mobile internet regions in the world.

Internet economy

The size of the internet economy in Southeast Asia in terms of GMV is forecast to reach US$72 billion in 2018 and to US$240 billion by 2025.

Among all the countries in the region, Indonesia’s internet economy’s market size is the largest at US$27 billion, followed by Thailand at US$12 billion. By 2025, Indonesia’s market will reach US$100 billion, followed by Thailand and Vietnam at US$43 billion and US$33 billion respectively.

Internet economy as percent of GDP

The region’s share of internet economy in the GDP rose from 1.5 percent in 2015 to 2.8 percent in 2018. By 2025, it is forecast to reach eight percent.

As of 2018, Vietnam leads amongst all the countries with its internet economy share in the GDP being four percent. Singapore follows at 3.2 percent, while the Philippines has the lowest share at 1.6 percent.


The GMV of the e-commerce market in the region was only US$5 billion in 2015 but is expected to grow over fourfold to US$23 billion in 2018, growing at a CAGR of 62 percent. By 2025, the sector’s GMV is expected to cross US$100 billion.

In 2018, Indonesia’s e-commerce market size will be the largest at US$12.2 billion, followed by Thailand and Vietnam at US$3 billion and US$2.8 billion respectively.

By 2025, Indonesia’s market will reach US$53 billion, followed by Vietnam at US$15 billion.

Online Media

The online media market will reach US$11.4 billion in 2018 in Southeast Asia. By 2025, it is predicted to reach US$32 billion.

Currently, Indonesia leads in online media in the region, with its market size in terms of GMV forecast to reach US$2.7 billion in 2018, followed by Thailand and Vietnam at US$2.4 billion and US$2.2 billion.

By 2025, the market size in Indonesia will reach US$8 billion, while Thailand’s and Vietnam’s will grow to US$7 billion and US$6 billion respectively.

Online travel

The online travel market is expected to grow to US$30 billion in terms of gross bookings value (GBV) in 2018, and to US$78 billion by 2025.

In this segment also, Indonesia leads amongst all the countries by a significant margin, at US$8.6 billion, followed by Thailand and Singapore at US$6.1 billion and US$5.5 billion.

By 2025, Indonesia and Thailand will continue to lead at US$25 billion and US$20 billion.


In 2018, the ride-hailing sector which covers online transport, as well as online food delivery, will reach US$7.7 billion in the region, and by 2025, it would grow to US$30 billion.

In this segment, Indonesia leads at US$3.7 billion, more than twice than the next country, Singapore, at US$1.8 billion.  This gap is expected to increase further by 2025, with Singapore’s and Thailand’s market size reaching US$4 billion, while Indonesia’s will grow to US$14 billion.


The year 2015 was the first time that fundraising in the internet economy in the region reached US$1 billion. By 2016, it increased fourfold to US$4.7 billion, and by 2017, it reached US$9.4 billion. The first half of 2018 has already witnessed fundraising close to the 2017 total, at US$ 9.1 billion.

In the last four years, nine companies alone attracted US$16 billion worth of investments out of the total US$24 billion invested in the region, with Grab taking the majority at US$6 billion.

Since 2016, the ride-hailing sector raised over US$10 billion worth of funds, while e-commerce, online media, and online travel raised US$8 billion, US$1.5 billion, and US$700 million respectively.  

Going forward

Vietnam’s current market size of the internet economy in terms of GMV is smaller compared to most of the neighboring countries, but it will continue to grow at one of the highest rates in the region, further increasing its share in the GDP.

Between 2015 and 2018, the CAGR was 35 percent, second highest in the region. By 2025, the CAGR is expected to be 25 percent, still the second-fastest. Indonesia will continue to lead during both periods, largely due to its growing population which has led to a higher number of internet users.

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