Mobile internet penetration has more than trebled in Southeast Asia since 2010, creating economic opportunity and GDP growth in the region.
In June 2016, Oxford Economics utilized a multi-stage research approach to analyze the potential economic impact of mobile internet penetration in the ten countries of Southeast Asia, a region where mobile internet is growing at a rapid rate. Impact is quantified in both GDP and employment as well as an associated increase in public finances, which can reflect a higher level of wages and profits resulting from higher GDP.
In line with global trends, mobile internet has grown at a rapid rate in Southeast Asia since 2010. This growth has been facilitated by several factors including significant investment in network coverage and the increasing availability of affordable smartphones. Grupe Special Mobile Association (GSMA) has estimated that smartphone adoption (as a share of all connections) in Asia Pacific rose from six percent in 2010 to over 40 percent in 2015. Oxford Economics predicts that this regional growth will continue to 86 percent in 2020, due to increased growth in countries that are relatively underdeveloped such as Cambodia, Indonesia, and Vietnam.
Potential economic gain from this increase in mobile internet penetration is considerable. Oxford Economics predicts that in 2020, GDP will be boosted by an additional $58.1 billion. However, through favorable investment and regulation resulting in an increase of penetration by 10 percentage points, GDP could rise to $73.4 billion by 2020. This rise in GDP resulting in higher wages and profits could provide benefits to governments in the region as well. The increase in government revenues could finance 1.3 million children through primary education, fund the construction of 7,400 km of new two-lane highways, or support the cost of routine immunizations programs across the region for 22 years.
Lastly, the report points out that varying levels of socioeconomic conditions and investment in the region have created substantial disparities. Oxford Economics predicts that growth in mobile internet penetration will be led by countries that have relatively underdeveloped but sizable consumer markets such as Indonesia and the Philippines. The report concludes that regulation will play a decisive role in the growth and benefit of mobile internet penetration.