Vietnam’s e-commerce sector has impressive growth to US$49 billion, even $57 billion by 2025

Updated: Nov 9

Vietnam’s e-commerce sector has enjoyed impressive growth in recent years, with the market scale projected to increase to US$49 billion, even $57 billion by Google, by 2025, from only $4 billion in 2015.


Source: BStyle.VN


This information was released at a seminar on developing e-commerce platforms to promote recovery and growth held by the Central Institute for Economic Management (CIEM) in Hà Nội earlier this week.


Economists said the Vietnamese Government has created favorable mechanisms to facilitate businesses’ engagement in e-commerce, along with ideal legal infrastructure related to the sector.


However, the sector is facing several major barriers related to online payments, foreign investment attraction, human resource development, the development gap between regions and localities, and policies and laws, he noted.


Nguyen Thanh Thao, head of the CIEM’s business environment and competitiveness research department, agreed that the biggest barrier to Vietnam’s e-commerce sector remains the policy and legal environment.


Ms.Thao said that this is a reality not only for the field of e-commerce but also an obstacle for many others because even if there is a support policy, the problem of enforcement is not simple.


Nguyen Thanh Hung from the Vietnam E-commerce Association (VECOM), said the growth rate of e-commerce in Vietnam has increased rapidly in recent years.


Although the growth has been quite positive, Vietnam's e-commerce market still faces many big obstacles such as online payment, order fulfillment, attracting foreign investment, human resource development, the gap in e-commerce access between localities, and the policy and legal environment, he said.


Along with that, in addition to the habit of using cash, customers' trust in products sold online has been a concern.


Decree 85/2021/NĐ-CP of the Government promulgated in 2021 on amendments and supplements to a number of articles of Decree No 52/2013/NĐ-CP on e-commerce mentioned support for e-commerce enterprises such as reducing the scope of licensing for e-commerce activities.


This decree also provides regulations for e-commerce goods, methods of origin and traceability management, and regulations related to the e-commerce business.


Le Duc Anh, Director of the Centre for Informatics and Digital Technology under the Department of E-commerce and Digital Economy said that support policies for businesses operating in the field of e-commerce are still limited.


In order to remove tax problems for businesses and promote the development of the e-commerce market, on October 30, 2022, the Government issued Decree 91/2022/NĐ-CP amending and supplementing articles of Decree No 126/2020/NĐ-CP dated October 19, 2020, detailing a number of articles of the Law on Tax Administration.


The Decree has made major amendments focusing on the contents of personal income tax declarations of organizations and individuals that do not incur personal income tax withholding; the responsibility of the organization established and operating under Vietnamese law as the owner of the e-commerce platform in providing information of traders, organizations and individuals that buy and sell goods and services on the trading floor.


In order to ensure Vietnam's e-commerce sector develops sustainably and effectively, economic experts said that the important solution is to limit the use of cash in e-transactions. Experts also stressed the need to seek ways to minimize the use of cash on delivery for digital transactions, as it still accounts for 11 percent of the total.


Source: VNS