South Korea · China · Japan · Taiwan · Singapore · Fortune Technology
Last week, a revealed that the U.S. was preparing to tell dozens of countries to pick a side
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“To be part of everything is to be part of nothing.
Key facts
- On August 11, Singapore sharply lifted its annual economic growth forecast from 2-4% to 4.5-5.5%, citing a boost from AI-related sectors and exports
- Japan’s Nikkei 225 and Thailand’s SET index are both up around 25% for the year; even after recent declines, South Korea’s KOSPI is almost 60% higher year-to-date
- Malaysia, for instance, has long seen an outflow of skilled talent to Singapore and the West, and is projected to become an “aged nation” by 2048, when 14% of its citizens will be aged 65
- Exports from South Korea, home to chipmaking giants SK Hynix and Samsung, surged by more than 60%
Summary
Taiwan is on track for its first year of double-digit GDP growth since 2010, thanks to surging demand for AI hardware exports. Exports from South Korea, home to chipmaking giants SK Hynix and Samsung, surged by more than 60%. Equity markets, too, are experiencing the AI boom. Yet economists who study the region are worried that AI’s gains won’t be evenly shared across Asia—and that for Southeast Asia’s economies, which sit on the lower end of the value chain, the boom could be more of a “short-term blip.” “The sugar rush economic boom that Southeast Asia is experiencing is from providing the supporting—not leading-edge—semiconductors, and the power and resources to drive data centers,” Danny Quah, an economist from Singapore’s Lee Kuan Yew School of Public Policy (LKYSPP), tells Fortune. For now, at least, Southeast Asian nations are benefiting from the AI boom.