Discover the hidden possibilities in Southeast Asia

COVID-19 has accelerated the rate of digitalisation. According to a report by Bain & Company, Google and Temasek, 2020 saw SEA gain 40 million new consumers who have accessed the internet for the first time. This digital surge is expected to be sustained and the internet sector is expected to grow to over US$300B GMV by 2025. Not only would sectors like ecommerce benefit, but nascent sectors such as HealthTech and EdTech will see growth as they are propelled by changing habits.

Tech giants and startups alike have set up innovation teams in Singapore to be closer to the mass of SEA consumers coming online and develop products dedicated for them. Since 2016, Singapore has been Google’s Centre of Innovation that powers the company’s efforts to serve the “next billion users” in SEA. In 2020, Zoom announced plans to set up an R&D centre in Singapore which will house hundreds of staff in key engineering roles.

With technology permeating all aspects of life, SEA consumers are generating massive amounts of digital footprints. As was the case in China's internet economy, which was transformed by Tencent's WeChat superapp, the treasure trove of user insights has and will continue to inspire new technological and business model innovations. Opportunities for companies, big or small, are aplenty.

For many consumers in SEA, their mobile phones are their primary, and often only, device through which they access the internet. This enables SEA to leapfrog to frontier technologies. For instance, SEA consumers are skipping credit cards for mobile e-wallets. 70% of SEA consumers are underbanked or unbanked today. With rapid smartphone adoption, digital-first finance services are giving traditional financial institutions a run for their money. Mobile payments in SEA is estimated to grow 700% between 2019 and 2025.

Despite differences between SEA markets, SEA consumers share many similar needs. For example, mom-and-pop retail is still the primary channel that provides everyday consumer goods to the people in multiple SEA countries. The informal economy in Indonesia is estimated to be 22% and 43% in Thailand. Telemedicine has also been on the rise in the region as consumers spread across the region’s many islands access doctors through health tech platforms. This similarity provides scale for technology companies that provide solutions to meet these needs.

According to Amb Michael Michalak, while companies in the US-ASEAN Business Council have a spread of operations in SEA, Singapore is the one place which every company has a presence in. This is unsurprising given Singapore's investments to make the country a Smart Nation and global tech node. The country has also enhanced digital connectivity with countries like New Zealand, Chile and Australia, to enable end-to-end digital trade, enable data flows across borders and collaborate on cutting edge projects.