As Artificial Intelligence (AI) reshapes workplaces across Southeast Asia, TFGI brought together voices from government, industry, think tank, and academia to explore the promise and challenges of this technological shift. While AI readiness scores show the region’s general preparedness, the discussions revealed the practical realities behind the statistics, from small business owners adapting to digital tools to policymakers considering how to support workers while encouraging innovation.

The discussion centred on technology, people, and societies in transition. Participants shared various perspectives as they explored how different countries find their approaches, from Singapore’s framework to Indonesia’s emerging regulations. The conversation acknowledged that behind every policy lie fundamental questions about work in the digital age and how communities can ensure technology serves broader needs. This dialogue, which marked the first session of 4 virtual regional roundtables and six in-country specific roundtables, is built upon TFGI’s ongoing work to understand how AI might transform Southeast Asian economies while promoting inclusivity.

Moderators and Participants:

• Redzuan Abdul Rahim, Director – Digital Services, Malaysia Digital Economy Corporation (MDEC)
• Theodore Sutarto, Assistant Deputy of Digital Economy, Coordinating Ministry for Economic Affairs, Indonesia
• Bunnalin Thongpim, Policy Analyst, Office of the National Economic and Social Development Board (NESDB)
• Yesim Elhan-Kayalar, Advisor, Office of the Chief Economist, Asian Development Bank
• Poon King Wang, Director LKY Centre for Innovative Cities (LKYCIC), Singapore University of Technology & Design (SUTD)
• Nguyen Quoc Viet, Vice Director, Vietnam Institute for Economic and Policy Research (VEPR)
• Saliltorn Thongmeensuk, Senior Research Fellow, Thailand Development Research Institute (TDRI)
• Adinova Fauri, Economic Researcher, Centre for Strategic and International Studies (CSIS)
• Shazrul Suhaimi, Research Associate, Khazanah Research Institute (KRI)
• Maciej Surowiec, Head of ASEAN Government Affairs, Microsoft
• Camelia Loh, Committee member of PIKOM Talent Gap Interest Group, PIKOM
• Ferdian Ari Kurniawan, Senior Policy Associate, AFTECH
• Geneve Yeo, Assistant Director, Employment Standards & Labour Relations, Ministry of Manpower, Singapore
• Herlina Ahmad Sadikin, SE Sectoral Development, Malaysia Digital Economy Corporation (MDEC)
• Izyan Rahim, Senior Executive, Malaysia Digital Economy Corporation (MDEC)
• Ming Tan, Founding Executive Director, Tech for Good Institute
• Citra Handayani Nasruddin, Programme Director, Tech for Good Institute
• Basilio Claudio, Programme Associate, Tech for Good Institute

Key Takeaways

1. AI and Automation are driving transformative changes across all employment sectors in Southeast Asia.

The roundtable revealed that human skills in empathy, cultural understanding, and practical craftsmanship remain valuable as automation less affects them. This retention of uniquely human capabilities is accompanied by an essential shift in knowledge work, where the ability to ask the right questions is becoming more valuable than possessing specialised technical knowledge. Such a transition democratises access to previously exclusive domains while creating new barriers around effective AI direction and evaluation. This dynamic challenges traditional job hierarchy structures, as AI increasingly handles technical execution while humans focus on problem framing and critical assessment. The discussion emphasised that disruption occurs primarily at the task level rather than eliminating entire jobs, giving a more gradual evolution of roles as specific tasks are automated rather than wholesale occupational displacement.

AI and automation are revolutionising industries—reshaping what work looks like, boosting productivity, optimising operations, and creating new growth sectors, particularly in manufacturing, logistics, and digital services. These technologies enable companies to scale more efficiently and serve markets with greater agility. AI is a helpful assistant, not a substitute, in roles requiring people-first thinking, empathy, and contextual awareness. The future of work in fintech is not about humans versus AI. It is about humans and AI working together, responsibly.

The participants recognised that AI is not a standalone technology. Instead, it is embedded within the broader digital technology ecosystem. They emphasised that the ultimate goal of technology adoption, AI included, is to improve productivity and unlock new economic opportunities, creating what can be described as ‘augmented and insulated jobs.

2. The technologies bring significant opportunities; however, challenges and risks remain.

Workforce displacement and skill gaps are significant concerns, particularly for informal, rural, and low-skilled workers. Digital divides persist, with underdeveloped areas at risk of being left behind. Participants identified a “middle vulnerability” pattern where workers with intermediate digital skills face disproportionate disruption, while both digital novices and experts may navigate the transition more successfully. This insight challenges conventional wisdom about which workforce segments require the most targeted support.

The roundtable emphasised that disruption occurs at the task level, requiring both occupational-level and task-based mapping As roles evolve gradually with automation,.persistent mismatch emerges between the supply and demand of skills in the labour market, requiring significant skilling and reskilling efforts. Challenges such as low R&D investment, skills mismatch, and inadequate education further widen the readiness gap.

Beyond skills concerns, participants highlighted an infrastructure dimension, distinguishing between basic consumer connectivity and the industrial-grade computing resources necessary for AI development. This distinction raises questions about “digital sovereignty” that go beyond regulatory concerns to address whether Southeast Asian nations can develop indigenous AI capabilities or will remain technologically dependent on global platforms.

Traditional MSMEs, especially family businesses, often operate outside formal digital ecosystems, creating an awareness gap about AI risks and opportunities. This further widens the three-fold challenge: the infrastructure, skills, and market readiness gaps that must be addressed for AI to benefit the region equitably.

3. Governance frameworks and thoughtful policies are valuable elements in balancing innovation, worker well-being, and economic competitiveness in Southeast Asia.

The discussion revealed an emerging “regulatory experiments” approach across ASEAN, where countries test different governance models that provide valuable learning opportunities for their neighbours. Indonesia’s work on the G20 Digital Skills Measurement Toolkit exemplifies this approach, revealing both surprising vulnerabilities in seemingly safe occupations through task-level analysis and unexpected resilience in supposedly high-risk roles.

This granular understanding of AI’s impact has led to a growing regional preference for hybrid governance that combines “soft law” mechanisms (ethics frameworks, industry standards, and certification programs) with traditional regulation. This balanced approach allows faster adaptation to evolving technologies while maintaining necessary protections. The effectiveness of such governance depends on specialised institutional capacity that many countries are still developing, creating regulatory gap risks and opportunities for innovative models like regulatory sandboxes and co-regulation partnerships.

Throughout the discussion, participants emphasised contextualising AI governance to Southeast Asia’s unique characteristics rather than importing governance models wholesale from other regions. This contextual approach acknowledges the region’s demographic diversity, varying digital readiness levels, and distinctive economic structures. Participants advocated for a human-centred, industry-agnostic, and empowering approach to AI adoption that focuses on scaling up AI and digital education, closing practical training gaps, addressing gender imbalances, and improving infrastructure access.

Existing initiatives on upskilling and reskilling, promoting ethical and inclusive AI adoption, and bridging industry and policy were recognised as crucial foundations. Talent development, particularly building a digital talent pipeline, is pivotal for adapting to AI advancements and preparing for emerging technologies. The discussion emphasised that while regional cooperation provides invaluable opportunities to share insights, pool resources, and address common challenges, localisation remains essential. Each country must ultimately develop approaches tailored to its strengths and needs, designing genuinely fit-for-purpose initiatives for its unique economic and social contexts.