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Thursday, November 7, 2024
CEOWORLD magazine - Latest - Special Reports - SEA Digital Economy Poised for Growth with AI and E-Commerce Leading the Charge – Singapore to Reach $29 Billion in GMV by 2024

Special Reports

SEA Digital Economy Poised for Growth with AI and E-Commerce Leading the Charge – Singapore to Reach $29 Billion in GMV by 2024

UIB Asia

The latest e-Conomy SEA report from Google, Temasek, and Bain & Company forecasts Southeast Asia’s digital economy reaching $263 billion in Gross Merchandise Value (GMV) in 2024—a 15% increase over the previous year. Revenue is projected to grow by 14%, reaching $89 billion, as the region advances toward profitable, sustainable growth.

Investment in AI infrastructure is rapidly expanding, with Southeast Asia attracting over $30 billion in the first half of 2024 alone. AI-related searches in the region have surged elevenfold over the past four years, as the young, digitally literate population with high smartphone penetration drives demand for AI-based products and services.

Digital economy leaders in SEA are progressing toward profitability, maintaining double-digit growth in GMV and revenue. The report highlights that ongoing growth will stem from deeper digital engagement, effective monetization strategies, and recovery in pandemic-affected sectors. E-commerce has also regained momentum, now fueled by video commerce.

E-commerce GMV is projected to reach $159 billion by 2024, with existing customers driving up to 70% of growth—a shift from earlier years dominated by new shoppers. Established players are reinvesting to expand GMV and protect market share amid competition from international players. E-commerce revenue is expected to increase 13% year-on-year (YoY) to $35 billion in 2024.

Video commerce, now accounting for 20% of e-commerce GMV (up from less than 5% in 2022), has transformed the landscape, introducing consumers to live shopping events and influencer-driven content that enhance the online shopping experience.

Food delivery is experiencing strong growth as new revenue streams emerge, such as in-app ads and subscriptions. Revenue in this sector is projected to rise 54% YoY to $1.7 billion in 2024, while GMV will grow by 7% to $19 billion. To boost profitability, platforms are enhancing restaurant visibility and optimizing operations through AI.

The transport sector has also rebounded beyond pre-pandemic levels, with revenue expected to grow by 36% YoY to $1.5 billion. GMV is set to increase by 18% to $9 billion, driven by strong demand, strategic pricing, and the expansion of established companies into rural areas, coupled with aggressive promotions by new entrants.

Online travel continues to outpace the broader digital economy, driven by intra-regional travel within Asia-Pacific. Higher airfares and a preference for luxury travel are expected to raise Gross Travel Bookings (GTB) to $46 billion in 2024, a 21% YoY increase. Revenue is projected to grow 18% to $20 billion. While direct booking channels remain dominant, online travel agencies have effectively monetized core services alongside ancillary offerings, such as financing and insurance.

The online media sector is projected to see significant growth, with GMV rising to $30 billion, an 11% YoY increase. Key drivers include video-on-demand and gaming, with SEA developers gaining recognition in casual gaming and hyperlocal content. Revenue sources remain diverse, as in-app purchases, ads, and subscriptions attract various player segments. Gaming influencers have fostered a vibrant creator ecosystem, with livestreaming strengthening real-time interaction between brands and consumers.

Digital Financial Services (DFS) are expanding, with revenue expected to grow by 22% to $33 billion in 2024, up from $22 billion in 2022. Digital payments and lending, accounting for over 90% of DFS revenue, continue to drive growth as e-wallet partnerships with major payment networks expand and QR code payments gain popularity.

A shift in investor behavior is reshaping wealth management in the region as digital payment adoption grows, risk assessment technology improves, and consumers increasingly turn to online channels for insurance and wealth management.

Singapore’s digital economy is set to reach $29 billion in GMV by 2024, marking a 13% increase from 2023. The resurgence of e-commerce, which rose from $8 billion in 2023 to $9 billion in 2024, along with double-digit growth in online media and travel, highlights the nation’s robust infrastructure and pro-business policies.

Singapore ranks among the top 10 countries globally in AI interest, with sectors such as education, marketing, and travel leading in search trends. Demand for AI-powered mobile applications, such as content creation tools, photo editing software, and virtual assistants, remains high. In response to rising demand, Singapore attracted $9 billion in AI infrastructure investment in early 2024, second only to Malaysia, which secured $15 billion.

 

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CEOWORLD magazine - Latest - Special Reports - SEA Digital Economy Poised for Growth with AI and E-Commerce Leading the Charge – Singapore to Reach $29 Billion in GMV by 2024
Anna Siampani
Anna Siampani, Lifestyle Editorial Director at the CEOWORLD magazine, working with reporters covering the luxury travel, high-end fashion, hospitality, and lifestyle industries. As lifestyle editorial director, Anna oversees CEOWORLD magazine's daily digital editorial operations, editing and writing features, essays, news, and other content, in addition to editing the magazine's cover stories, astrology pages, and more. You can reach Anna by mail at anna@ceoworld.biz