Ecommerce
Southeast Asia’s internet economy hits $100 billion
The two pacesetters in the region are Indonesia and Vietnam, which lead the pack with growth rates in excess of 40% a year.
The internet economies in Malaysia, Thailand, Singapore and the Philippines are growing by between 20% and 30% annually, with no signs of slowing down, according to Google and Temasek multi-year research program.
This is a remarkable feat compared to other regions, but hardly the best showing in Southeast Asia. The two pacesetters in the region are Indonesia and Vietnam, which lead the pack with growth rates in excess of 40% a year.
Time is money: competing for user engagement
Companies are switching their focus from acquiring new customers to driving engagement. Their goal is to convince users to stay on their platforms for longer, in the belief that purchases will follow. Vying for user engagement, companies have expanded their scope across sectors, moving into new services, gamifying promotions and streaming enticing content.
This has ignited more intense competition, while providing users with more choices and lower prices.
Growth opportunities beyond metros
The growth of the internet economy has yet to spread evenly across Southeast Asia. Seven metropolitan areas that house just 15% of the region’s population still account for more than 50% of the internet economy.
People living in these metro areas buy six times more online than those living elsewhere. The internet economy, however, has the potential to grow twice as fast in areas outside the big cities, bringing all Southeast Asians on board.
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– After falling significantly in 2020, oil prices have returned to pre-pandemic levels
– The rise has been driven by OPEC+ production cuts and an improving economic climate
– Higher prices are likely to support a rebound in oil-producing emerging markets
– Further virus outbreaks or increased production would pose challenges to price stability
A combination of continued production cuts and an increase in economic activity has prompted oil prices to return to pre-pandemic levels – a factor that will be crucial to the recovery of major oil-producing countries in the Middle East and Africa.
Brent crude prices rose above $60 a barrel in early February, the first time they had exceeded pre-Covid-19 values. They have since continued to rise, going above $66 a barrel on February 24.
The ongoing increase in oil prices, which have soared by 75% since November and around 26% since the beginning of the year, marks a dramatic change from last year.
Following the closure of many national borders and the implementation of travel-related restrictions to stop the spread of the virus, demand for oil slumped globally.
In the wake of the Saudi-Russia price war in early 2020, Brent crude prices fell from around $60 a barrel in February that year to two-decade lows of $20 a barrel in late April, as supply increased and demand plummeted. The value of WTI crude – the main benchmark for oil in the US – fell to record lows of around $40 a barrel last year on the back of a lack of storage space.
While global demand for oil remains low, one factor credited with reversing the trend is the decision to make significant cuts to oil production, which subsequently tightened global supplies.
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