Racing toward the Future: AI in Southeast Asia
Racing toward the Future: AI in Southeast Asia
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AI will create a platform in Southeast Asia to advance manufacturing, retail, financial services, and healthcare, but local AI talent and capabilities are scarce outside Singapore, thus opening a potential gap in developing solutions to socioeconomic issues in Southeast Asia’s highly diverse countries.

SINGAPORE - Artificial intelligence (AI) will have a profound impact on industries, societies, and governments in the 21st century - enabling technology adoption, digital transformations, and new customer experiences. The immediate need to embrace AI has been readily apparent in the COVID-19 pandemic as it plays a crucial part in  detecting clusters, tracing contacts, identifying symptoms, and developing drugs.

AI presents both an opportunity and a challenge for Southeast Asia. It will create a platform to advance key sectors such as manufacturing, retail, financial services, and healthcare. However, local AI talent and capabilities are still limited, especially outside Singapore - creating a potential gap in the development of solutions for specific socioeconomic issues across the highly diverse Southeast Asian countries, consumers, and industries.

Surveys of more than 110 AI users, providers, and investors and interviews with representatives of more than 25 companies and government agencies in Singapore, Malaysia, Indonesia, Thailand, Vietnam, and the Philippines examined the expected economic impact of AI across multiple use cases and industries and enabled a better understanding of Southeast Asia’s AI preparedness. The study sheds light on the immense value at stake. If well executed and applied, AI may add US$1 trillion to the region’s gross domestic product (GDP) by 2030.

Its potential impact often causes AI to be viewed as a panacea, prompting early birds to dive in without a clear business plan. The study reveals the importance of a focused AI implementation: 80 percent of potential value comes from fewer than 20 percent of use cases, primarily in sales, marketing, and supply chain management. Revenue management is the starting point for AI investments in Southeast Asia, drawing two to three times more attention than cost management, as exemplified in use cases such as next product to

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