The World Bank Group has updated its 2026 economic growth forecasts for several East Asian nations, citing the global demand for AI hardware as a primary driver. Vietnam's growth projection rose by 1.1 percentage points to 7.4 percent, while Malaysia and Thailand saw increases of 0.7 percentage points, reaching 5.1 percent and 2.0 percent respectively.
In contrast, Pacific Island countries are experiencing growth of 2.2 percent, which is 0.5 percentage points below previous expectations due to high energy costs. China's economy is currently growing at 4.4 percent, with domestic demand hampered by adjustments in the property sector and a soft labor market.
Despite the regional manufacturing boom in AI-related goods, the World Bank notes that local adoption of AI technology by firms and individuals remains slower than in advanced economies. Businesses cite concerns regarding security, privacy, high costs, and a lack of expertise as significant barriers to implementation.
To address these challenges, the IFC suggests mobilizing private capital for digital and energy infrastructure, expanding business financing, and investing in workforce development. These measures aim to help smaller firms improve competitiveness and accelerate the broader integration of AI across the regional economy.
