Generative Artificial Intelligence (AI) is rapidly becoming an integral part of daily life in Southeast Asia, with 243 million people (58% of the working population) actively using it. Its adoption is occurring four times faster than the emergence of mobile internet, signaling a substantial impact on the region’s economy. This trend is highlighted in the 11th annual e-Conomy SEA report, titled ‘Building the Intelligent Economy,’ a collaboration between Google, Temasek, and Bain & Company.
The report forecasts that widespread AI adoption will drive a 17% year-on-year (YoY) growth in the region’s digital economy, reaching $368 billion in Gross Merchandise Value (GMV) by 2026. This trajectory is set to surpass the $1 trillion mark by 2035. Using ‘tokens’ as a new metric for the AI economy, the report predicts that increasing trust in agentic commerce will lead to a 60-fold surge in AI utilization across the region over the next five years.
Key Findings from the e-Conomy SEA 2026 Report:
1. AI Fuels Growth Across All Sectors
Artificial intelligence is reshaping how people live, shop, and travel within the digital economy. E-commerce ($226 billion GMV, +18% YoY) stands as a cornerstone of this transformation, with shoppers leveraging multimodal search and in-app assistants to confidently make complex purchases. These personalized experiences naturally boost conversions by 10% and order volumes by up to 75%.
In online travel ($59 billion GMV, +10% YoY), while traditional search engines remain the primary platform for travel planning, generative AI has surpassed social media as the second most popular tool for organizing intricate itineraries.
Online media ($44 billion in revenue, +22% YoY) is personalizing content feeds and assisting advertisers in identifying more relevant audiences, leading to a 10-20% improvement in engagement quality and establishing commercial media as a $4 billion market.
Mobility and food delivery ($40 billion GMV, +15% YoY) save consumers time through predictive recommendations, smarter route planning, and AI-driven offerings like ride-sharing, fostering healthy transaction growth.
Finally, digital financial services ($1,650 billion GTV, +16% YoY) are enhancing consumer experiences through real-time fraud detection, broader credit access, and personalized financial advice that complements human consultation. This is occurring alongside Singapore’s leadership in the region for wealth management platforms.
2. Consumer Trust to Unlock the Era of Agentic Commerce
Digital automation has already found strong footing in the region, with 72% of users relying on everyday functions like price tracking. This familiarity sets the stage for agentic commerce, with 75% of users expressing willingness to allow AI agents to autonomously compare prices and complete transactions on their behalf.
This momentum is underpinned by regional optimism: people in Southeast Asia view AI as a net positive for society, with 62% reporting greater trust in AI tools today than a year ago. This trust, built on proven outcomes (56%), increasing awareness (55%), and accurate results (53%), signals a clear path toward deeper platform integration. To feel comfortable using new autonomous capabilities, users expect clarity and protection, including robust privacy guarantees (44%), transparent information about AI capabilities and limitations (36%), and the ability to cancel autonomous transactions (30%).
3. Four Key Areas Require Adaptation to Support AI Adoption
To support the projected 60-fold increase in AI usage in the region by 2030, the broader digital ecosystem must systematically evolve across four critical enablers:
- Accelerated Agentic Operations and Sustainable Economics: Businesses must move beyond using AI for isolated queries to executing end-to-end, multi-step tasks, supported by robust privacy assurances and clear safety protocols. Concurrently, AI models need to become increasingly accessible and deliver tangible value, enabling consistent adoption across businesses of all sizes.
- Scalable Physical Infrastructure: Physical expansion must rapidly match the escalating demand for computing power. Achieving this trajectory requires approximately a threefold expansion of data center capacity over the next five years, with AI workloads occupying a dominant share of the total infrastructure.
- Rigorous Model Efficiency and Energy Consumption: National frameworks, such as Singapore’s mandatory Energy Efficiency Ratio (EER) regulations under its Infrastructure Bill, should guide the development of next-generation facilities, alongside enhanced access to clean energy, exemplified by Malaysia’s Corporate Renewable Energy Supply Scheme (CRESS).
- Unified Regional Governance: The anticipated ASEAN Digital Economy Framework Agreement (DEFA) in November 2026 will be the world’s first regional digital trade agreement, providing a foundational framework for the continued growth of Southeast Asia’s digital economy.
