Vietnam’s digital economy is expected to grow 20 per cent annually in the 2023-2025 period and is on track to reach $45 billion by 2025, according to a report released recently by Google, Temasek, and Bain & Company.

Digital payments continue to grow in the country, driven by strong support from the government, investment from commercial banks, and the widespread popularity of QR codes. This trend is expected to accelerate as the State Bank of Vietnam promotes cashless payment services in rural and remote areas, according to the report.

It forecasted that manufacturing and exports will be key to growth. The weakening of export demand impacted growth momentum in the first quarter of 2023. While Vietnam will continue to play a significant role as global companies diversify their supply chains, securing public investment to address infrastructure constraints will be key to unlocking the growth potential. Wages and employment will also continue to have a cascading impact on the digital economy.

Full recovery in the tourism sector is expected this year, driven primarily by sharp growth in domestic travel. The launch of new airlines and an increase in the number of international routes have enabled this uptick, despite the delayed return of Chinese tourists, the report noted.