ASIA
03 September 2026
Get ready for Artificial Intelligence
Developing Asian economies have much to do to exploit the potential of Artificial Intelligence.
Generative AI tools have the potential to accelerate Asia’s development, reduce poverty, and realise the opportunity of an Asian Century.
But too many of Asia’s poorer economies are way behind when it comes to “AI readiness”, the capacity to use and benefit from AI, and will miss out on much of the benefits of AI. Adoption by firms remains low, slowing the pace and scale of technology diffusion and reducing productivity gains across the economy.
According to the Asian Development Bank, AI readiness depends on digital infrastructure, skilled workers, innovation, strong institutions, and economic structure. Data shows a significant gap between advanced economies – like Australia; Hong Kong; Japan; Korea, New Zealand; and Singapore – and developing economies such as Cambodia, India, Myanmar, Papua New Guinea, and the Philippines.
Digital infrastructure and skilled workers are the biggest challenges for the region's developing economies. Job postings show that advanced economies are hiring more AI skills than developing ones – including by poaching tech workers from countries like the Philippines.
Trading in AI enabling goods, like electronics, computers, and other digital hardware, helps spread technology and speeds up AI adoption. And not surprisingly ADB analysis finds that these goods account for a much bigger part of trade in Hong Kong; Singapore; and Taiwan than in most developing economies.
ADB simulations suggest that AI increases economic growth more quickly and to a greater extent in advanced economies because they are better prepared and have higher shares of tasks that can adopt AI. Leading economies — including China, Japan and Korea – combine strong government investment with substantial firm-level research and development, enabling AI development and deployment at scale.
In advanced Asia and the Pacific, AI is estimated to lift gross domestic product growth by about 0.6–2.1 percentage points (pps) by 2030, with the gains easing to 0.5–1.5 pps by 2040.
In contrast, developing Asia and the Pacific experiences smaller but more persistent gains, at around 0.2–1.8 pps in 2030 and 0.1–1.6 pps in 2040. The simulations also show that if developing economies improve their AI readiness, their growth can increase by up to 0.4 pps, with China having the largest possible gain. The largest per-task productivity gains occur when workers possess complementary skills, enabling them to augment AI capabilities.
What to do?
Instead of worrying and complaining about AI, as many are doing, Asian economies, especially the poorer ones, need to improve their digital infrastructure, skills, innovation, and institutions, and exploit the immense benefits of wider AI use.
This article is unashamedly a cut and paste of the ADB publications mentioned in the references.
But too many of Asia’s poorer economies are way behind when it comes to “AI readiness”, the capacity to use and benefit from AI, and will miss out on much of the benefits of AI. Adoption by firms remains low, slowing the pace and scale of technology diffusion and reducing productivity gains across the economy.
According to the Asian Development Bank, AI readiness depends on digital infrastructure, skilled workers, innovation, strong institutions, and economic structure. Data shows a significant gap between advanced economies – like Australia; Hong Kong; Japan; Korea, New Zealand; and Singapore – and developing economies such as Cambodia, India, Myanmar, Papua New Guinea, and the Philippines.
Digital infrastructure and skilled workers are the biggest challenges for the region's developing economies. Job postings show that advanced economies are hiring more AI skills than developing ones – including by poaching tech workers from countries like the Philippines.
Trading in AI enabling goods, like electronics, computers, and other digital hardware, helps spread technology and speeds up AI adoption. And not surprisingly ADB analysis finds that these goods account for a much bigger part of trade in Hong Kong; Singapore; and Taiwan than in most developing economies.
ADB simulations suggest that AI increases economic growth more quickly and to a greater extent in advanced economies because they are better prepared and have higher shares of tasks that can adopt AI. Leading economies — including China, Japan and Korea – combine strong government investment with substantial firm-level research and development, enabling AI development and deployment at scale.
In advanced Asia and the Pacific, AI is estimated to lift gross domestic product growth by about 0.6–2.1 percentage points (pps) by 2030, with the gains easing to 0.5–1.5 pps by 2040.
In contrast, developing Asia and the Pacific experiences smaller but more persistent gains, at around 0.2–1.8 pps in 2030 and 0.1–1.6 pps in 2040. The simulations also show that if developing economies improve their AI readiness, their growth can increase by up to 0.4 pps, with China having the largest possible gain. The largest per-task productivity gains occur when workers possess complementary skills, enabling them to augment AI capabilities.
What to do?
Instead of worrying and complaining about AI, as many are doing, Asian economies, especially the poorer ones, need to improve their digital infrastructure, skills, innovation, and institutions, and exploit the immense benefits of wider AI use.
This article is unashamedly a cut and paste of the ADB publications mentioned in the references.