Southeast Asia’s digital economy has reached new heights, poised to exceed US$300 billion by the end of 2025. With strong growth driven by key sectors like e-commerce, food delivery, and online travel, the region has outperformed expectations, surpassing its US$200 billion goal set a decade ago. Singapore, in particular, stands out as the leading hub for AI investment, drawing a majority of the region’s funding, which fuels innovation and infrastructure expansion.
Southeast Asia is on track to surpass US$300 billion in digital economy revenue by the end of 2025, driven by rapid growth over the past decade. The latest e-Conomy SEA report from Google, Temasek, and Bain & Company highlights the significant strides the region has made, with Southeast Asia’s digital economy now tripling in size compared to a decade ago. The region’s gross merchandise value (GMV) is powered by thriving industries such as e-commerce, food delivery, online travel, and digital media, showing that Southeast Asia has not only met but exceeded previous expectations.
The report’s findings mark a major milestone for the region, revealing that private artificial intelligence (AI) funding in Singapore has surged by 55% from the second half of 2024 to the first half of 2025, with Singapore continuing to lead as the focal point for AI development in the region. The addition of new countries to the study—Brunei, Cambodia, Laos, and Myanmar- provides a broader perspective on the evolving digital economy across Southeast Asia.
Key findings from the 2025 e-conomy SEA report
Rapid Growth and Expansion: Southeast Asia’s digital economy has grown exponentially, surpassing the US$200 billion target set for 2025, three years ahead of schedule. According to Ms Sapna Chadha, Vice President for Southeast Asia and South Asia frontier at Google, the region’s forecast was ambitious a decade ago, but the digital economy has far exceeded expectations. Now, the region is forecasted to achieve a GMV exceeding US$300 billion by the close of 2025, a testament to the region’s rapid digital transformation.
The inclusion of additional countries such as Brunei, Cambodia, Laos, and Myanmar provides a more comprehensive look at Southeast Asia’s digital ecosystem, reflecting the diverse and expanding nature of the region’s economy. These four new countries contribute approximately 2% of the GMV, underscoring their growing role in the region’s economic development.
Singapore’s Dominance in AI Investment: Singapore continues to be the standout hub for AI investment in Southeast Asia, attracting 55% of all regional funding. With nearly 500 active AI start-ups, the city-state remains the leader in AI-driven innovation, showcasing its commitment to becoming a global leader in the field. As AI and cloud capacities continue to expand, Singapore’s role in driving the region’s digital economy forward is more significant than ever.
Emerging Frontiers in AI and Infrastructure: While Singapore remains the leader in AI investment, neighbouring Malaysia and Indonesia are emerging as new frontiers for digital infrastructure. As the region’s digital economy grows, Malaysia and Indonesia are positioned to capitalise on this expansion, offering new opportunities for businesses and investors in digital services and AI-driven solutions.
Revenue Growth Across Southeast Asia: Revenue across Southeast Asia is expected to reach US$135 billion, highlighting the growing profitability of the digital economy. Key sectors driving revenue growth include e-commerce, food delivery, transport, online travel, and digital financial services. The region’s ability to generate significant returns underscores its potential as a major global digital economy hub.
The future of Southeast Asia’s digital economy
As the digital economy continues to expand, Southeast Asia’s growth trajectory shows no signs of slowing down. With AI becoming a key driver of innovation, countries like Singapore are positioning themselves as central players in shaping the future of global trade. The focus on infrastructure development and AI integration, particularly in Malaysia and Indonesia, highlights the region’s dynamic approach to technological advancement.
The sustained growth of Southeast Asia’s digital economy offers exciting prospects for businesses and investors, with emerging markets poised to benefit from the region’s expanding digital ecosystem. As AI funding continues to pour into the region, Southeast Asia is likely to continue as a digital powerhouse, with new opportunities emerging across various sectors, from e-commerce to financial services.
With Southeast Asia’s digital economy exceeding expectations, the region is set for an even more prosperous future, driven by digital innovation, AI advancements, and expanding infrastructure.
Shikha Negi is a Content Writer at ztudium with expertise in writing and proofreading content. Having created more than 500 articles encompassing a diverse range of educational topics, from breaking news to in-depth analysis and long-form content, Shikha has a deep understanding of emerging trends in business, technology (including AI, blockchain, and the metaverse), and societal shifts, As the author at Sarvgyan News, Shikha has demonstrated expertise in crafting engaging and informative content tailored for various audiences, including students, educators, and professionals.
