Economic growth across East Asia and the Pacific is proving resilient despite global uncertainty, with the region projected to expand 4.5% this year as strong demand for high-tech goods offsets weakness in some major economies, the World Bank said in its latest East Asia and Pacific Economic Update.
Several economies are benefiting from manufacturing and exports linked to the global surge in artificial intelligence (AI) investment. The World Bank raised its 2026 growth forecasts for Vietnam to 7.4%, Malaysia to 5.1%, and Thailand to 2%. China, the region’s largest economy, is forecast to grow 4.4% as weak labor-market conditions and continued property-sector adjustments weigh on domestic demand. Pacific island economies are projected to expand 2.2%, slower than previously expected.
“East Asia and Pacific’s deep integration into global value chains and economic dynamism have positioned the region to benefit from the surge in global AI-related activity,” said Carlos Felipe Jaramillo, World Bank vice president for East Asia and Pacific. “The challenge now is to turn the region’s strength in producing AI-related goods into widespread AI adoption that boosts productivity and creates more and better jobs for millions of people. If countries act boldly now, AI can become a powerful engine for opportunity, rising incomes, and a more prosperous future for all.”
The World Bank report said the bigger challenge is spreading AI beyond export industries and into the broader economy. Adoption by companies and individuals remains below advanced-economy levels, constrained by costs, skills shortages, and security and privacy concerns. For many countries, the fastest gains could come from adopting existing, more affordable AI tools rather than developing new technologies from scratch.
For the Philippines, that transition could be particularly important as the country seeks to capture more of the region’s technology-driven growth. The World Bank’s April 2026 update projected Philippine growth at 3.7% for 2026, below the pace of several regional peers, before a rebound to 5.6% in 2027.
The World Bank report points to digital infrastructure, skills, financing, and broader technology adoption as key to turning AI into productivity gains and jobs. For the Philippines, strengthening those foundations could help local businesses and workers participate more fully in the AI economy rather than benefiting mainly through demand for technology-related exports elsewhere in the region.
“The private sector can play a central role in translating AI’s promise into more and better jobs across East Asia and Pacific,” said Sarvesh Suri, International Finance Corporation regional vice president for Asia and Pacific. “By mobilizing private capital for digital and energy infrastructure, expanding financing for businesses, and investing in workforce skills, countries can accelerate AI adoption across the economy while helping small firms become more competitive, dynamic, and resilient.”
AI has yet to significantly affect automatable jobs, but it is already reshaping demand for skills. Firms increasingly seek AI expertise alongside analytical and social skills. Only 13% of jobs in the region involve the complex thinking and judgment where AI is most effective, compared with 39% in advanced economies, highlighting the need to prepare workers for a changing labor market.
The World Bank recommends that governments strengthen the business environment, digital and energy infrastructure, financing, and workforce skills while adapting AI to local needs. It also urges governments to use the technology to improve public services and strengthen regulations and regional cooperation.
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