Marc Woo, Managing Director for Vietnam at Google Asia Pacific, spoke to The Hanoi Times about the potential of Vietnam's digital economy in 2025 and the role of big cities like Hanoi in driving growth.
| One of Google's activities to promote AI solutions in Vietnam. Photo: Google |
What factors will drive the growth of the digital economy in 2025 and what projections for Vietnam's digital economy?
In 2024, the country maintained double-digit growth rates, driven mainly by e-commerce and online travel while the online media sector in Vietnam has emerged as the fastest growing in Southeast Asia, with a 14% year-on-year growth in 2024, according to the e-Conomy SEA 2024 report.
In addition, Vietnam's talented developers are increasingly making a global impact, creating popular apps for a global audience.
The growing artificial intelligence (AI) interest and the government's support for AI and semiconductor technologies are strengthening the country's digital landscape. While global economic headwinds have impacted private funding, investor confidence remains high, particularly in sectors such as software, fintech, healthtech, and AI.
With a young population, a vibrant startup ecosystem, and supportive government policies, Vietnam is positioned as a promising digital market in Southeast Asia, projected to reach US$200 billion by 2030.
How do large cities like Hanoi, Ho Chi Minh City, and Danang contribute to the growth of the digital economy?
Vietnam’s major cities, particularly Hanoi, Ho Chi Minh City, and Danang are emerging as dynamic hubs for digital innovation and economic growth. These urban centers are playing a pivotal role in shaping the country’s digital future, contributing significantly to its burgeoning digital economy by accelerating the following advantages:
Strengthening talent pools: These cities boast a burgeoning pool of tech-savvy talent, including software engineers, data scientists, and cybersecurity experts. This is essential to develop innovative digital solutions and attract foreign investment. Universities and research institutions in these cities are at the forefront of technological advancements and continue collaborating with industry partners to drive innovation in areas such as AI and semiconductor technology.
Nurturing startups ecosystem: Major cities such as Hanoi, Ho Chi Minh City, and Danang form a vibrant startup community in Vietnam that attracts significant global capital. This active startup landscape, particularly focused on digital services, creates a fertile environment for businesses to emerge and thrive.
Technological infrastructure enhancement: Robust telecommunications infrastructure, including high-speed internet and 5G networks, enables seamless digital connectivity and widespread internet adoption in these cities. This leads to an evolving maturity and willingness to adapt new solutions and services among internet users in metropolitan areas. In particular, there is a notable interest and demand for AI in metropolitan areas such as Ho Chi Minh City and Danang.
What specific sectors are expected to drive the growth of Vietnam's digital economy in the coming years, and why?
| Marc Woo, Managing Director for Vietnam at Google Asia Pacific. |
Vietnam’s digital economy is poised for robust growth, fueled by the convergence of digitalization and artificial intelligence. Several sectors are emerging as key drivers of this expansion.
The ongoing rise of e-commerce will significantly contribute to Vietnam’s digital economy in the coming years. In 2024, this sector became the primary growth engine of the country's digital economy with an on-year increase of 18% to US$22 billion in gross merchandise value (GMV). By 2030, e-commerce GMV is projected to reach $63 billion.
Within Southeast Asia, the growth of e-commerce is further accelerated by the emergence of video commerce. This sub-segment has experienced rapid expansion, contributing to increased GMV and customer acquisition. While the long-term impact of video commerce on customer retention remains to be fully assessed, it fuels deeper customer relationships and brand loyalty.
Vietnam’s online media sector is experiencing the fastest growth amongst SEA countries with an increase of $6 billion in 2024, representing a 14% compound annual growth rate (CAGR), and is forecast to reach $11 billion by 2030.
Several factors contribute to this remarkable expansion:
Thriving game development ecosystem: Vietnam is becoming a game-developing hub in Southeast Asia. Rising demand for talented developers and a supportive ecosystem foster innovation in the mobile gaming sector, creating compelling gaming content and contributing to the growth of the online media market.
Original video content driving streaming and creator economy: The production of original video content is a key driver of subscription growth in Vietnam's competitive streaming landscape. Furthermore, it is accelerating the creator economy through the video commerce sub-segment. Video commerce unlocks new income streams and fosters a more dynamic and diverse online media ecosystem.
By leveraging AI-powered solutions, Vietnam can unlock the digital economy across sectors. Attracting investment and fostering innovation in AI are critical steps for the country's ambitious goal of increasing the digital economy's contribution to GDP from 16% in 2024 to 30% by 2030, reaching a projected $200 billion. Fully harnessing the potential of AI can solidify its position as a high-income developed country by 2045.
How can Vietnam leverage its young, tech-savvy population to maximize its digital economy potential?
| The Google for Startups program attracts many startups in Vietnam. |
Vietnam's young population, who is tech-savvy and eager to embrace digital technologies, mostly in metropolitan areas such as Ho Chi Minh City and Danang, and the country's double-digit growth in the digital economy facilitates the integration of AI-powered solutions.
To ensure Vietnam's competitiveness in the global AI landscape and drive sustainable digital economic growth, it needs to cultivate a highly skilled digital and AI workforce. This will require significant investment in education and skills development with a focus on digital, AI, and data science. Those factors will enable Vietnam to tap into a broader talent pool, fostering a more inclusive digital ecosystem.
With the growth of the digital economy and the development of AI, how can Google help the Vietnamese government?
As part of our long-standing commitment to supporting Vietnam's digital transformation and AI development, we have worked with the Vietnamese government on numerous comprehensive initiatives:
Build for Vietnam, with Google AI: In partnership with the Vietnam National Innovation Center, the initiative aims to accelerate Vietnam's advancement in AI, focusing on two key pillars: Build for Talent and Build for Startups. Each pillar addresses critical areas to empower Vietnam's human capital, nurture its increasing startup ecosystem, and maximize AI adoption.
This year, we aim to empower Vietnamese startups in the AI era with AI-focused programs.
Accelerate Vietnam Digital 4.0: Launched in partnership with the Ministry of Industry and Trade (MoIT), this program provides free digital skills training to MSMEs, job seekers, and students. It has trained 650,000 people, exceeding its initial target of 500,000.
Al Research: Google has funded a $1.5 million grant for AI research through Fulbright University Vietnam.
AI Opportunity Agenda for Vietnam: Building on Googleʼs three-pillar agenda for responsible AI progress - unlocking opportunity, promoting responsibility, and enhancing safety - this paper proposes three key recommendations for Vietnamʼs government, businesses, and research institutions to maximize the benefits of AI. These include investing in innovation infrastructure, building an AI-ready workforce, and working in partnership to promote inclusive adoption and accessibility.
Thank you for your time!
