PH digital economy on track to hit $24B in 2023
The Philippines’ digital economy is set to hit $24 billion this year in terms of value of goods sold, continuing its double-digit climb towards $35 billion by 2025, making it one of the fastest growing digital economies in Southeast Asia.
This is according to this year’s edition of the annual e-Conomy Southeast Asia report, which combined Google Trends, Temasek insights and Bain & Company analysis of five other countries in the region including Indonesia, Malaysia, Singapore, Thailand, and Vietnam.
“This momentum is poised to continue, fueled by the immense potential of (artificial intelligence) and the digital participation of internet users outside Metro Manila which could drive medium to long term growth,” Google Philippines Head of Data and Insights Nikki L. Del Gallego.
The projection this year will mark a 13-percent increase compared to the size of its digital economy in 2022, which was pegged at $22 billion.
From a broader perspective, the report also showed that the revenue from the digital economy in Southeast Asia is poised to hit $100 billion this year, growing by as much as 1.7 times as fast as the region’s gross merchandise value (GMV).
In the Philippines’ digital economy, Google said that e-commerce remains the main engine of growth, accounting for 70 percent of the overall activities.
This is followed by online media and online travel, which the tech giant said is set to reach $5 billion and $4 billion by 2025.
The report cited that online travel shows the largest growth from 2022 to 2023 at 88 percent, with the growth attributed to the ongoing momentum of the Philippines tourism industry.
Despite these growth prospects, Bain & Company partner Bennett S. Aquino said that challenges remain in growing the Philippines’ digital economy, issues that must be addressed both by the private sector and the government.
“The private sector will need to supply the talent. It will really need to develop the right technologies and really understand the customer pain points and come up with the right solutions,” Aquino said, adding focus must also be given to digital literacy and infrastructure.
“The government will need to continue the frameworks on data privacy… I think the critical things here are like data privacy, data sharing, interoperability, and cybersecurity as well,” he added. INQ
