Who Is Leading The ASEAN Online Economies?

In South-East Asia there has long been a boom in tech development and this boom is set to continue to increase. One of the major areas of the region’s economy that has shown the most impressive growth patterns is the internet economy and the 3 countries leading the way are Thailand, Singapore, and Indonesia.

The current overall market leader according to Statista is Indonesia is currently reporting an internet economy that eclipses the major ASEAN economies. It is worth a whopping 40 billion US$ while Thailand comes in a distant number 2 worth 16 billion US$. Next in the pecking order is Singapore worth 12 billion US$. However, much of this is down to the size of the populations.

Check out the stats here…

Indonesia has a population of 267.7 million people making its internet economy worth US$149 per capita or person, while Thailand’s population is 69.43 million, so its market is worth US$230 per capita or person. It just goes to show that having a large population can push up the overall economic figures, but when you get down to the nitty-gritty of it and look at the per capita, you get a feel for what is going on.

Now if we then compare this to Singapore, and the per-person internet expenditure per year is US$2,226 per capita which now turns the tables upside down. This is because Singapore only has a population of 5.64 million that conjures up its 12 billion US$ worth of online commerce per year.

If we begin to look further down the stats at the other 3 major ASEAN economies, we have Vietnam, Malaysia, and the Philippines.

Vietnam’s internet economy is equal to Singapore’s 12 billion US$, but the population of the Socialist Republic is 95.54 million which eclipse Singapore and pushes down the online expenditure per capita considerably to US$125.

Next, we have the Malaysian and Filipino economies also included. Malaysia’s yearly expenditure is 11 billion US$ and divided by a population of 31.53 million its internet economy per capita is in good shape with a US$348 per capita rating.

Finally, the Philippines has a population of 106.7 million which is the second-highest out of all the ASEAN economies while the country has the lowest internet economy which is just 7 billion US$. At this time this amounts to $65.60 which is quite surprising as the Philippines has quite an active online economy and as a country, it has modernised as quickly as countries like Thailand and Malaysia, yet, there are quite a few island areas that are still not online!

As for other economies within the ASEAN community, these are Laos, Myanmar, and Cambodia which all have very low internet economies and expenditure per capita even though out all the ASEAN countries, Cambodia has the highest GDP growth rate so this is one to look out for in the future.

What Are the Major Driving Forces Behind These Internet Economies?

Numerous mini economies operate within each ASEAN market drives each of their online economies. Most of the money built up is via domestic online orders rather than cross-border operations. Although cross-border internet sales are still a part of ASEAN economies so we cannot rule this out.

Yet, cross-border sales between ASEAN countries is quite low which is very different in comparison to Western Economies and Far Eastern economies such as S.Korea, Japan, and China.

Online Food Ordering and Delivery

It should come as no surprise that online food orders make up for the largest portion of online sales. Whether adding these to the overall figures of the internet economy is cheating in some way is questionable.

We used to order phone by telephone, but since the internet enables us to order online via a website or app, this has given the internet economic figures in every country a major boost.

Retail is another strong contributor. In countries like Thailand, local apps like Lazada have become extremely popular. This is an online marketplace that allows sellers to register a branded virtual shop and sell their goods online.

One of the reasons Lazada has become so popular is because you can choose to ‘pay by cash’. In a country where not everyone likes to pay by card and there is still some mistrust when it comes to online shopping coupled with the fact, there are minimum spends when paying by card, the ‘pay by cash’ is a great system. The delivery driver rocks up, and a cash payment is made!

Check out Lazada here…

Another online economy that we did not mention already is supermarket delivery services. Only Singapore has an established network of online supermarket delivery operations but Thailand is quickly catching up. Its major supermarkets are now coming online especially since the country released a brand new app called app which was originally used for taxi services and eventually bought Uber out of the market.

Since Grab took Uber offline it has dominated Thailand’s special mail delivery services and also added supermarket delivery services to its app. On top of this, another app that is popular in Asia called ‘LINE’ has also done the same except LINE does not have a taxi/transport service. LINE was simply a social media messaging service which Grab does not have.

Where LINE and Grab come head to head is online mail/package delivery, food delivery, supermarket and orders.

Check out an interesting LINE Vs Grab article here…

Online Gaming

Next up, in the South-East Asian economy is online gaming. This is a market that has exploded not just in Asia but globally. It feels like online gaming has been around forever, but it is quite a new concept and one that is growing immensely. OK, so low standard or amazingly simple online games have been around for a while as well as those that do not require a huge amount of graphics.

However, Mobile-Online-Battle-Arena (MOBA) gaming is starting to kick off. The reason is that internet connections have improved immensely with high-speed fibre optics being installed all over Asia even in rural areas. And let’s not forget, countries like Thailand, Singapore, and Indonesia (we can also include Cambodia in this) have 4G networks with better coverage than countries such as the UK.

The key markets that are kicking off are as mentioned, MOBA gaming, online gambling, and game console games that connect to the internet for 1-on-1 match up on sports games. There are also major tournament races whereby racing games connect from 5 to 100 players all involved in huge races be it F1, Grand Turismo, or any other popular racing game.

You can check out slotxo44 here as an example of a popular Thai gaming website…

Online Financial Services

Online financial markets such as FX, stocks and shares, and cryptocurrency are huge in South East Asia now. The fastest-growing market also rising in popularity as ASEAN countries are crypto which ASEAN governments have finally begun to regulate this once unregulated market.

Thailand, Philippines, and Singapore are leading the way for the cryptocurrency sphere where there are now numerous exchanges and wallets available to citizens in all 3 countries. Vietnam is also in on the act thanks to BitcoinVN which was Vietnam's first cryptocurrency exchange.

Domestic exchange services are favoured by most citizens because many of the pairings with major cryptos like BTC and ETH are in their local currency. The largest exchange in the region is Huobi which is a Singaporean crypto exchange.

Check out Huobi crypto exchange here…

What Can We Expect for The Future of the ASEAN Market?

The SEA internet economy is not done growing just yet. This is an economy that is set to triple in the region from US$100 billion to a massive US$300 billion by the time we get around to 2025. That’s just 5 years away and SEA is going to be one of the largest online economies in the world.

Yet, it still will not come close to the USA’s massive US$2.1 trillion internet economy or China’s 3.66 trillion Yuan online economy which are both interesting and new topics to cover because these 2 countries have massive cross-border operations which I will be covering in the future.