Economic growth in Asia-Pacific stands to benefit from increased artificial intelligence (AI) and cloud computing adoption across the region, according to the Asian Development Bank (ADB).

In a brief titled “Leveraging Artificial Intelligence and Cloud Computing to Accelerate Growth in Asia and the Pacific,” published on Friday, Sept. 5, the Manila-based multilateral lender noted that spending for cloud computing in high- and middle-income economies in the region, including the Philippines, amounted to $202.75 billion last year, or 0.05 percent of their combined gross domestic product (GDP), citing International Data Corp. (IDC) data.

For the same countries, AI spending in 2024 reached $73.44 billion, or 0.02 percent of their GDP.

Using IDC data, ADB researchers estimated Philippine spending on AI at $303.3 million, or 0.07 percent of the country’s GDP, in 2024.

For cloud computing, an estimated $2.013 billion, or 0.43 percent of GDP, was spent in the Philippines last year.

These spending levels for AI and cloud computing in the country are equivalent to about 9.5 percent and 11.5 percent, respectively, of the national government’s annual budget.

According to the ADB, “countries that increase AI and cloud spending realize important economic gains.”

Based on the ADB’s analysis, “a one-percent increase in AI spending in Australia, India, Indonesia, Japan, South Korea, Malaysia, New Zealand, the Philippines, Singapore, Thailand, and Vietnam yields an increase of 0.03 percent of these countries’ GDP on average,” the report read.

A similar uptick in cloud spending would hike their respective GDP by 0.01 percent.

“Cumulatively, the AI impact represents a GDP increase of $4.9 billion if all the countries studied increase their spending on AI by one percent,” the ADB said.

“The combination of cloud and AI technologies creates stronger economic benefits than either technology alone. A one-percent increase in the share of spending on AI technologies enabled by cloud increases GDP by 0.034 percent, representing a cumulative impact of $5.88 billion. This higher impact demonstrates the value of technology integration,” it added.

Specifically for the Philippines, total AI and cloud spending plus their economic spillovers accounted for 1.18 percent of GDP in 2024, above the levels in neighboring Vietnam (0.92 percent) and Indonesia (0.8 percent) but below those of Malaysia (1.34 percent) and Thailand (1.19 percent).

However, the maturity level of the Philippines’ cloud and AI policies remains “low,” according to the report.

ADB estimates showed that improving AI and cloud policies in the country could grow spending to 0.12 percent and 0.7 percent of GDP, respectively.

As AI can be both disruptive and transformative, government and industry leaders on Thursday, Sept. 4, called for reskilling and collaboration to prepare Filipinos for the future of work that would be dominated by AI.

At the European Chamber of Commerce of the Philippines’ (ECCP) 2025 Future of Work Forum, Department of Labor and Employment (DOLE) Assistant Secretary Lennard Constantine C. Serrano cited a recent World Economic Forum (WEF) report cautioning that rapid advances in AI, automation, and digitalization will lead to an “endgame” of 78 million jobs globally by 2030.

Serrano noted that 40 percent of core skills required in today’s workplace will need to adapt to these changes.

“In the Philippines, 68 percent of workers require upskilling, with only 38 percent preparing for training,” he added.

The DOLE official also emphasized that promoting digital literacy is a key priority to ensure that every Filipino can succeed in a digital-first world.

From the private sector, Jack Madrid, president and chief executive officer (CEO) of the IT and Business Process Association of the Philippines (IBPAP), stressed that while AI will disrupt certain types of jobs, it also creates opportunities for workers to take on higher-value roles.

For Madrid, AI enables the workforce to focus on tasks like contextual problem-solving and managing complex customer escalations that require human intervention.

But jobs involving data entry, transactional support, scripted processes, and work with structured data are highly automatable and most vulnerable to disruption, he added.

He noted that jobs everywhere are shifting away from repetitive tasks toward roles that require judgment, moving from transactional to creative work, and from analog to technology-enabled functions.

Madrid underscored that the Philippines’ competitive advantage rests not just on technology but on its people.

He stressed that the information technology and business process management (IT-BPM) industry has grown to 1.9 million employees because of the communication skills of Filipino talent.

“It’s not just about English anymore. It’s about something we are the best in the world at—the bedrock of empathy,” he added.

Madrid urged the government to integrate digital and soft skills into the curricula of the Department of Education (DepEd), Commission on Higher Education (CHED), and Technical Education and Skills Development Authority (TESDA).

The private sector, he added, must continue investing in continuous skilling to keep the workforce globally competitive.

“AI is inevitable,” Madrid said. “There is no doubt that AI is reshaping the work landscape.”

The challenge is ensuring that Filipinos are ready to thrive alongside it, he added.

(Ricardo M. Austria)