Report: SE Asia Leads Adoption Of New Tech - Steady Rise In FDI Is Testament To Investor' Confidence
Meta and Bain & Company report unveils key digital consumer insights as eCommerce outlook across the region remains positive and digital consumer population continues to grow!
Southeast Asia’s long-term outlook remains robust with the region’s projected GDP growth from 2022 to 2023 forecast to outpace most other markets such as the US, the EU, and China. This is according to Bain & Company and Meta ’s annual SYNC Southeast Asia report which looks at the digital economy and the future of e-commerce in the region.
By the end of 2023, Southeast Asia is expected to maintain its projected growth at 5.1% compared with other markets such as the US (1.3%), the EU (2.1%), and China (4.7%) according to Bain & Company. Southeast Asia’s projected annual inflation rate from 2022 to 2023 is also expected to fare better than most of its peers. The region’s annual inflation rate is projected to decline from 4.2% to 3.3% by end 2023, outperforming the US (at 4.2% by 2023), the EU (at 4.3%), and India (at 6.0%).
The digital consumer population in Southeast Asia is still growing steadily and is forecast to reach 370 million by end-2022, accounting for 82% of the total population of 15-year-olds and above. This figure is projected to rise further to 402 million by 2027, accounting for 88% by the end of the forecast period.
The study also found that Southeast Asia is seeing more foreign direct investment (FDI) being channeled into the region. FDI accounted for a greater proportion of total investment in 2021, at 17% versus 15% in 2015 and just 9% in 2009. This steady rise in foreign investment is a testament to investors’ confidence in Southeast Asia and is fueling the growth of new technologies such as fintech. The study found that Southeast Asia sees a higher penetration of e-Wallets, cryptocurrency and non-fungible tokens compared to most other markets such as China, the US, the EU and Japan, with almost 70% in Southeast Asia having used at least one metaverse-related tech in the last year.
"This new evolution of digital consumers will undoubtedly be the driving force for Southeast Asia's eCommerce gross merchandise value (GMV) growth" said Praneeth Yendamuri, Partner at Bain & Company. "With longer term favorable demographic profile, and as Southeast Asia leads in the adoption of future technologies, businesses that focus on staying the course in the region, build a truly integrated channel strategy and necessary capabilities, make their supply chains resilient, and leverage new tools and technologies to engage with digital consumers will emerge as winners.”