PH Digital Economy Projected to Reach PHP 1.94 Trillion in Value by 2025
E-commerce and streaming are just some of the sectors that are expected to continue growing in the country.
With the Philippines currently at 69% internet penetration, the local digital economy is expected to continue growing within the next two years. For this reason, digital transformation consultant Publicis Sapient projects that the total digital economy will be valued at $35 billion (approximately PHP 1.94 trillion) by 2025.
According to a report, Publicis Sapient said that “The Philippines’ digital economy is poised for growth, with a projected value of $35 billion by 2025 and a CAGR (compound annual growth rate) of 209%.”
It explained that the country’s digital economy is currently in its “growth stage.” It adds that there is an “ongoing expansion to smaller cities nationwide, increased social media advocacy, and a growing reliance on online purchasing, with nearly 63% of users now using mobile applications for e-commerce transactions.”
Digital economy is defined by the Asian Development Bank (ADB) as “a broad range of economic activities that use digitized information and knowledge as key factors of production.”
Which Sectors Are Expected to Experience Continuous Growth?
Among the sectors that fall under the digital economy, three are expected to experience continuous growth in the coming years.
First is e-commerce, which is expected by Publicis Sapient to grow at a CAGR of 17%. The United States Department of Agriculture (USDA) likewise predicts that e-commerce sales in the country will reach $24 billion (approximately PHP 1.36 trillion) by 2025.
The other two sectors expected to see continuous growth are streaming and food delivery. Both sectors experienced dramatic growth during the pandemic as people relied on streaming and food delivery platforms during lockdown.
Business Opportunities Within the Digital Economy
Given the growth of the country’s digital economy, there are countless opportunities for entrepreneurs. Andrew Male, Client Partner for ASEAN at Publicis Sapient, says that there exists a large opportunity in online banking.
“With 63% of the population in the Philippines being unbanked, and with mobile users spending an average of over five hours daily on their smartphones, banking is set to be the largest superapp opportunity in the Philippines,” he says.