Prior to that, Lazada, described as a new power of Vietnam’s e-commerce, was swallowed up by Chinese giant Alibaba at the price of $1 billion.

 

Lazada is the Number 1 in Vietnam’s e-commerce industry now which made up 36.1 percent of total e-commerce turnover in 2015. 

 

Experts have warned that Vietnam’s e-commerce market, which makes up 2.8 percent of total turnover of retail goods and services, may fall into foreign hands.

Once taking over Lazada, Alibaba will also inherit Lazada’s first position in the market, though analysts commented that it would be a challenge for the giant to hold this position.

 

A website with the domain name 40tencuop.com debuted with a challenge thrown directly at Alibaba.

 

Cong An Nhan Dan reported that South Korean Lotte, a big player in the retail market, plans to expand its business in Vietnam and open an e-commerce website later this year.

 

An analyst commented that while many Vietnamese e-commerce firms have to shut down because the market is too severe, foreign companies continue to jump into the Vietnamese market. 

 

The companies, with powerful financial capability, would accept losses in the first phase of operation in Vietnam and wait for opportunities.

 

A report of the Ministry of Industry and Trade (MOIT) showed that the value of the B2C (business to customer) market in 2015 was $4.07 billion, up by 37 percent over 2014, accounting for 2.8 percent of total turnover of retail goods and services.

 

It is estimated that an online shopper spends $160 on average a year.

 

The majority of online shoppers still prefer making payment in cash, accounting for 91 percent, while 48 percent make transfer via bank accounts and 20 percent of e-commerce clients use payment cards.

 

Le Thi Ha from MOIT’s E-commerce and Information of Technology, commented that though e-commerce has been developing rapidly in recent years, online payments lag far behind other regional countries and the world.

 

According to Visanet, the world’s largest online payment network, Vietnam’s electronic payment index in 2015 was 37 percent. 

 

The index was equal to Thailand’s, and much lower than other Asian countries, including Singapore (55 percent), China (60 percent) and South Korea (70 percent).

 

Do Thang Hai, Deputy Minister of Industry and Trade, said that 2016 would be a pivotal year which marks a new development stage in Vietnam’s international economic integration. This would pave the way for e-commerce and electronic payment to develop more strongly.