Southeast Asia is accelerating its adoption of artificial intelligence, aiming to boost productivity and attract global investment. With major players like Google DeepMind, Microsoft, and Alibaba Cloud opening AI labs in Singapore and investing across the region, analysts say AI could raise ASEAN’s GDP by 10–18% by 2030. Yet despite the optimism, experts warn that widening disparities in digital infrastructure and talent may leave the region deeply divided.
Uneven gains
While countries such as Singapore and Malaysia are rapidly advancing, with strong funding, digital infrastructure, and a growing base of AI start-ups, others lag far behind. Nations like Cambodia, Laos, and Myanmar struggle with limited human capital and regulatory frameworks.
The gap is stark. Since 2020, Singapore has hosted 495 AI start-ups, while the Philippines and Thailand have had only 10 and 20, respectively. Singapore alone attracts over 55% of all private AI funding in Southeast Asia.
As AI reshapes the workforce, countries heavily reliant on manual or routine-based jobs face greater risk of job displacement but fewer chances to enjoy AI-driven productivity gains. The Philippines’ massive BPO sector, accounting for nearly 7% of its GDP, is particularly vulnerable, with up to 40% of tasks potentially automatable through generative AI.
Meanwhile, Malaysia leads the race for data centers, hosting more than half the planned regional capacity. An advantage developing countries cannot easily replicate due to the soaring cost of GPUs, microchips, and energy demands.
Asean-wide AI adoption
To prevent deeper inequality, analysts urge regional cooperation focused on AI governance, education, and resource-sharing. Collaborative initiatives like Singapore’s multilingual Sea-Lion language model demonstrate how shared tools can benefit the entire bloc.
Experts warn that countries without robust AI regulations risk problems such as misinformation and deepfakes capable of influencing elections. Another one could be cyberattacks enabled by AI-generated malware. And finally, Increased dependence on foreign tech giants, potentially undermining sovereignty.
Rather than pursuing costly “AI sovereignty,” analysts recommend that Southeast Asian states improve data quality and governance, train local AI talent and build selected parts of the AI value chain where they have strengths.
Collaboration, not competition, may be the key. No ASEAN nation can dominate AI alone, but together they can leverage shared interests to ensure the benefits of AI are broad and inclusive.
Reference
Lim, K. (2025, November 21). Why Asean’s AI ambition may lead to widening economic and tech divide. South China Morning Post. https://www.scmp.com/week-asia/economics/article/3333690/why-aseans-ai-ambition-may-lead-widening-economic-and-tech-divide?module=top_story&pgtype=section