The development of artificial intelligence (AI) has fundamentally transformed how society engages in everyday interactions. Much like the era of electrical innovation, AI has generated an entirely new set of economic activities and opportunities such as foundation models, data, and AI datacentres. However, these emerging economies come with complex challenges that must be carefully addressed. A notable concern is the potential disruption to existing jobs, as certain roles may undergo transformation or decline.
This reality highlights the urgent need for workforce reskilling to prepare the individuals for the jobs that will emerge within the AI-driven economy. Our regulatory strategies for safeguarding digital technologies must also evolve to keep pace with relentless innovation.
In Southeast Asia, several countries are actively working to adapt to these changes. In the Tech for Good Institute’s report on “The Evolution of Tech Governance in Southeast Asia”, it is highlighted that governments are developing national AI frameworks in response to generative AI, drafting guidelines focusing on AI ethics and safety, and promoting AI skills to future-proof the workforce. The central goal is to ensure that AI development in the region remains inclusive and equitable, benefiting all segments of the population. The key challenge now is determining how Southeast Asia can successfully navigate these shifts and guarantee that the economic impact of AI is both widespread and positive.
Recognising the significance of this discussion, the Tech for Good Institute participated in the “Harnessing AI for ASEAN’s Economic Growth” panel, at a seminar hosted by Microsoft. The panel was held at the sidelines of the ASEAN AI Working Group meetings.
Moderator and Panellists
- Melissa Yoong, Director of Government Affairs, Microsoft Singapore (Moderator)
- Lawrence Liew, Director of AI Innovation, AI Singapore
- Peter Lovelock, Chief Innovation and Delivery Officer, Access Partnership
- Fitzkhoon Liang, Associate Director, Ecosystem Development, NUS Enterprise
- Keith Detros, Programme Manager, Tech for Good Institute
Key Takeaways:
1. Leveraging Southeast Asia’s tech optimism and MSMEs are crucial for inclusive AI growth
Southeast Asia presents a tremendous opportunity to harness the transformative power of AI, driven by its distinctive demographics and economic landscape. Across the region, 90% of students and 72% of employees already use generative AI daily. In countries like Indonesia and Thailand, people view AI more as a benefit than a risk, according to the Stanford AI Index Report. This widespread optimism and readiness form a solid foundation for the region’s rapid AI adoption. To leverage this optimism further, particular attention must be given to the micro, small, and medium enterprises (MSMEs) in the region. Southeast Asia is home to over 70 million MSMEs, which represent 97% of all businesses and contribute up to 85% of total employment. As the backbone of the region’s economy, empowering MSMEs with AI tools could significantly boost productivity and level the competitive playing field. This could include AI-powered support solutions, customer service automation, and enhanced operational efficiency—capabilities that were once traditionally reserved for large enterprises. By leveraging the tech optimism for broad-based adoption and a focus on MSMEs, the region can create an environment which allows for leapfrogging opportunities to arise.
2. Ensuring robust foundations will allow for inclusive and responsible design, development, and deployment of AI.
The transformative potential of AI cannot be assessed in isolation. Its broader impacts rely on robust digital foundations that enable the creation of applications, business models, and innovations built upon it. To scale adoption effectively, certain foundational elements must first be established. Core digital infrastructure, including reliable cybersecurity and effective data governance, is critical to building trust in AI. These must be complemented by basic provisions such as widespread connectivity, affordable devices, and accessible digital public goods.
To ensure AI’s benefits are distributed equitably, these foundational elements must be in place. Once established, they allow AI to be integrated into the broader tech ecosystem which acts as a catalyst for progress. In addition, investments in foundational AI capabilities such as local data, computing capacity, and scalable infrastructure can unlock new opportunities. By ensuring that the right foundations are in place, the region can leverage AI as a powerful tool for inclusive and sustainable innovation.
3. In governing emerging technologies, iterative and agile governance is a must.
AI governance must be agile and responsive, striking a balance between fostering innovation and protecting society from emerging risks. Over the past few years, AI development has grown at a compound annual growth rate (CAGR) of 35.9%, showing no signs of slowing down. This rapid advancement is exemplified by the emergence of agentic AI, which has the potential to disrupt mid-level employment.
However, challenges remain in governance, especially as technology is evolving faster than regulation can adapt. In the digital age, the traditional regulatory cycle is ill-equipped to match the speed of technological innovation and may even hinder progress. Existing policies may lack effective enforcement mechanisms, and may need amendments to address the overly cautious design that may stifle innovation. To address this, an iterative approach to policymaking centered on continuous testing, learning, and recalibration is essential. Regulations must be adaptive and fit-for-purpose to evolve in parallel with the technologies they govern.
