Southeast Asia internet economy forecast cut on economic headwinds - KFGO

By Chen Lin

SINGAPORE (Reuters) – Southeast Asia’s net system is expected to beryllium worthy $330 cardinal by 2025, though this a downgrade from a erstwhile forecast owed to economical uncertainty and much unit connected tech companies to marque a profit, an manufacture study said connected Thursday.

The yearly report, by Alphabet’s Google, Singapore authorities capitalist Temasek Holdings and planetary concern consultants Bain & Company, trimmed its forecast for 2025 from $363 cardinal successful past year’s report.

“Amidst planetary macroeconomic headwinds, reduced disposable income, sky-rocketing prices, and little merchandise availability, determination is tapering of request from Southeast Asia consumers,” the trio said successful a associated release.

The portion of 11 countries is 1 of the world’s fastest increasing net markets, owed to a young population, wide smartphone usage and urbanisation, and a increasing mediate class.

The report, which covers Indonesia, Thailand, Vietnam, Singapore, Malaysia, and the Philippines, is inactive upbeat connected this twelvemonth and sees the net system increasing 20% to $200 billion, 3 years earlier than anticipated successful an inaugural study successful 2016.

All six countries are expected to station double-digit maturation betwixt present and 2025, with Vietnam having the fastest increasing integer system this twelvemonth astatine 28%.

Indonesia, the region’s astir populous nation, saw its integer system turn 22% to $77 cardinal this year, contributing to astir 40% of Southeast Asia’s full online spending.

On the tech concern front, portion early-stage deals are continuing with beardown momentum, late-stage deals are seeing “more pronounced dips” and a intermission successful plans to spell public.

Global investors are getting progressively cautious amid rising involvement rates and plummeting banal valuations, the study said, with archetypal nationalist offering prospects acceptable to grind to a adjacent halt for the adjacent 12 to 18 months.

The integer fiscal services assemblage is expected to overtake e-commerce to go the region’s apical concern sector, with payments taking up the bulk stock of the deals.

In the archetypal fractional of 2022, the assemblage saw a grounds backing of astir $4 billion.

Meanwhile, Vietnam, Indonesia and Philippines are apt to pull much investors successful the longer-term, the study said.

“Universally investors mostly expect woody enactment to retrieve from 2024 onwards,” said Fock Wai Hoong, Deputy Head of Technology & Consumer and Southeast Asia astatine Temasek.

Venture capitalists had $15 cardinal connected manus to prolong deals astatine year-end 2021, the study said.

(Reporting by Chen Lin successful Singapore; Editing by Ed Davies)