Southeast Asian countries will strive to become the region's leading AI hub

The emerging economies of Southeast Asia are trying to become the leading AI center – a race in which they both converge and, quietly, fight among themselves.

The Association of Southeast Asian Nations (ASEAN), made up of 10 countries with a total population of 672 million people, has advantages compared to Europe or the US

With over 200 million people between 15 and 34the area's young and largely technological population makes the area adaptable to future technological advances. That, along with government support for accelerating AI in the region, could bring big rewards for local workers.

“AI can significantly improve productivity across industries, and this increase in efficiency can lead to increased income for all employees,” Jun Le Koay of the consultancy Access Partnership and author of the research paper “The Southeast Asian Advantage: An Emerging AI Leader” said CNBC.

“Furthermore, as businesses increasingly adopt AI technologies, new jobs are emerging that require AI skills. This evolution creates opportunities for low-income people to acquire new skills and move into better-paying careers,” he said.

Le Koay said the rise of AI provides opportunities for Southeast Asia to make use of existing infrastructure. Koay believes that ASEAN countries have made “great strides” in greatly increasing internet access over the past ten years which has “created a digital native population that is ready to adopt and innovation with AI. “

With smartphone adoption between 65% and 90% in ASEAN countriesAI adoption is expected to take shape quickly.

Grace Yuehan Wang, CEO of Network Media Consulting and a scholar at the London School of Economics, does not expect any of the ASEAN countries to lead the AI ​​race anytime soon.

“ASEAN as a region has shown a strong GDP growth rate in recent years and is undoubtedly one of the most economically prosperous blocs in the world in the future,” she told CNBC.

There is an improved digital infrastructure, education of “high-level technical talents in the technology industry including AI, as well as world-class universities (both STEM – science, technology, economics and mathematics – and universities comprehensive), successful business and research collaborations. elements still missing in the ASEAN AI ecosystem,” she said.

The AI ​​competition between ASEAN countries is “mainly in attracting foreign investment and cooperation with universities around the world,” Wang said.

Singapore steals a march

Ten countries – Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam – make up the ASEAN club. All 10 have published national AI strategies.

Singapore was among the first to publish his vision, in 2019. The island state updated its plans in December 2023. Ambitions include expanding its AI workforce to 15,000 — triple the current amount — a as well as creating research and development centres.

An AI Center of Excellence for the Manufacturing Sector opened in September, with the aim of integrating artificial intelligence across supply chains.

Singapore's AI mission is state-sponsoredwith the government committing to invest 1 billion Singapore dollars ($741 million) over the next five years.

The country seems to have stolen a march, “thanks to R&D, economy, education system, international business environment,” Wang said.

Singapore was ahead of Salesforce's 2023 Asia Pacific AI readiness agendawhich evaluated 12 countries. Other ASEAN member states – Malaysia, Indonesia, Vietnam, the Philippines and Thailand – were lower on the list, in eighth to twelfth.

Local AI for developing countries

Singapore's muscle doesn't seem to have stopped the ambitions of its near neighbours.

Vietnam is banking on developments in AI, playing strong in assembly, testing and packaging capabilities as it meets global demand for chips. The country national strategy including ambitions to develop into an ASEAN center for research and development of AI solutions by 2030. The country, for example, has attracted $1 billion investment from South Korean manufacturing extends to 2025.

In 2023, VinAI, part of the multi-sector conglomerate Vingroup, released an open source language module designed specifically for Vietnamese users called PhoGPT.

The local alternative to ChatGPT suggests that “English-dominant AI models cannot be applied to all social and cultural contexts, and at a deeper level, it reflects the efforts in to overcome fears of widening divisions and inequalities among the technological sectors and the less powerful countries. “, said Wang.

German artificial intelligence translation startup DeepL already uses “rich linguistic diversity,” which Chief Revenue Officer David Parry-Jones says is an “asset, fostering a wealth of 'cultural exchange and deepening regional identity.”

Parry-Jones told CNBC that the European startup wants to offer ASEAN AI language models that could boost manufacturing, translate legal documents or support multilingual customer service centers in the region.

“We know that companies and governments are looking for best-in-class, context-aware translation tools so they can continue to grow quickly without being locked in by language barriers,” he said.

Other developing countries are looking at using AI for traditional labor-intensive industries.

For example, Cambodia's 60-page report describes how the developing country wants to use AI for “social good” and agricultural technology, promoting the sector which represented 22% of Cambodia's GDP and employs around 3 million people in 2018.

Developing ASEAN countries that are not as digitally advanced as Singapore face greater challenges in terms of being AI-ready, let alone implementing a full AI policy.

“There are a number of regulatory building blocks that need to be complete and robust before AI can be credibly started,” Kristina Fong, a senior researcher for economic affairs at the ASEAN Research Center at the ISEAS-Yusof Ishak Institute, told CNBC.

She said AI's “adverse effects on consumers could come fast and hard without any institutional oversight” with a need for a state-level conversation to “manage these rapid developments effectively with minimal harm.” social.”

Going out of Europe

ASEAN countries put together regional guidelines on it AI governance and ethics in February. A year earlier, European Union officials on a tour of Southeast Asia tried to persuade them to follow EU AI rules.

Instead of being controlled, ASEAN countries argued that the EU had been too quick to adopt regulation without fully understanding the risks of AI.

The Asian bloc has outpaced Europe in terms of AI regulation, using a “lightweight approach that seems to be the most appropriate for the region,” Fong said.

“This is largely due to a number of factors including the lack of a central legislative body in ASEAN, unlike the EU, as well as the distinct differences in digital capabilities and governance capabilities of the among ASEAN member states,” she said, adding that the Southeast Asian approach. framework on AI ethics “serves more as practical guidance,” rather than strict policy.

Wang said that the difference in ASEAN's AI ethics is not necessarily a battle between choosing a Western or a Chinese approach. International cooperation, she said, is central to ASEAN's AI ethics framework.

The fundamental challenge facing ASEAN countries is “not a technological one, but a political one,” Wang said, with the Covid-19 pandemic pushing countries to work together more closely on trade and diplomacy.

What will keep them on the right track to achieving their AI plans is keeping the population young, feisty.

Perhaps, Wang said, a national education strategy to make AI plans more effective.