Due to travel restrictions, Singapore’s Internet economy falls 24% to US$9 billon in 2020
Singapore’s Internet economy has fallen by 24% this year to US$9 billion, according to a report by Google, Temasek and Bain & Company.
This was largely due to Covid-19-led travel restrictions, which resulted in a decline of 70% year-on-year in online travel gross merchandise value (GMV) over the period.
Despite the overall decline, GMV in e-commerce rose by 87% year-on-year, although this was insufficient to offset the contractions in online travel, as well as transport & food, which fell by 26%.
Online travel contributes a significant amount to Singapore’s internet economy. Last year, it made up about 50% of the city-state’s GMV.
Pre-Covid-19, users in Singapore were spending 3.6 hours online per day on average; this rose to 4.5 hours at the height of lockdowns, and has now tapered to 4.1 hours a day, states the report.
The pandemic has also caused a significant number of users to try new digital services: 30% of such consumers were new, and 91% of the new users say they intend to continue this behaviour post-pandemic.
Internet users in Southeast Asia have continued to grow in 2020 with 400 million people year-to-date, compared to 360 million users in 2019. The report estimates that 70% of the population in the region is now online.
By 2025, it predicts that Southeast Asia’s Internet economy will generate over US$300 billion, indicating growth despite headwinds.