Advantage Southeast Asia: Emerging AI Leader

Advantage Southeast Asia: Emerging AI Leader

Artificial intelligence (AI) is offering a once-in-a-generation opportunity for economic growth and societal transformation, with the conversation dominated by the early winners supporting the infrastructure buildout for the foundational layers of the AI tech stack. However, the democratisation of AI as a general-purpose technology is creating significant benefits that will accrue to countries that accelerate AI diffusion across its people and businesses. Our estimates suggest that AI can deliver a staggering USD 835 billion in economic benefits to businesses in Southeast Asia (SEA) by 2030, representing a substantial 16% of its combined GDP.

The AI Advantage – Southeast Asia’s moment

When it comes to AI, it is advantage Southeast Asia. With a mix of a digitally savvy youth population, dynamic businesses, and governments with a pro-digital and collaborative mindset, the countries in the region are at the forefront of AI diffusion and would reap the most rewards.

  1. Young and enthusiastic population: Southeast Asia boasts a large, tech-savvy youth population that is highly adaptable to new technologies. With over 660 million people and high smartphone penetration, the region represents a vast and rapidly expanding market for AI-driven products and services. 70% of the people in the region see AI as a net positive for society, which is higher than peers in Japan (44%), Australia (43%), and the US (42%).
  2. Businesses going beyond AI adoption: Businesses in Southeast Asia are increasingly motivated to leverage AI for innovation, efficiency, and new opportunities. The region has cultivated a dynamic startup ecosystem, with over 2,000 AI startups attracting significant funding. 1 in 3 businesses in the region have implemented responsible AI principles, which is higher than in developed countries like the US (27%), Japan (23%), and South Korea (22%).
  3. Governments with pro-digital and collaborative mindset: Governments across Southeast Asia are actively crafting policies and fostering public-private collaboration to support AI adoption. All ten countries in the region have already established national AI strategies or AI initiatives. ASEAN’s collaborative regulatory environment and initiatives, such as the ASEAN Guide on AI Governance and Ethics, also promote responsible AI development.

Continuing the momentum – Driving the advantage further

Several game-changers will press home the region’s AI advantage. The Association of Southeast Asian Nations (ASEAN) needs to step forth and align AI plans across SEA countries while promoting its model for AI policy development globally. Governments and organisations should target 100% adoption of cloud-first policies to fully harness the power of AI. Building an AI-ready workforce with 100% AI literacy is critical. Economic incentives for AI acceleration will play a key role, as will the ability to monitor AI diffusion across businesses in the region.

Access the full report here

 

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