Asia (ex China) Is Asleep At The AI Wheel

Since the launch of generative AI chatbots like ChatGPT last November, America has been consumed by the hype, hoopla, and indeed the hysteria surrounding the promise and perils of artificial intelligence. This has had ripple effects all over the world, with investors swooning over the earnings prospects of AI-related stocks like Nvidia, which saw its market value triple in less than eight months, and briefly rose above the $1 trillion mark last week.

But policymakers have also begun to fret over the darker side of unleashing AI—destroying jobs in entire industries—and AI champions are even warning that the new technology, if unchecked, could pose an existential threat to humanity. Which is why it is hugely important that Asia, which accounts for close to 60% of the world’s population and 45 % of global GDP, should be in the driver’s seat in managing the risks and rewards of AI rather than being asleep at the wheel.

China, of course, is the exception since AI has been a policy priority under its President Xi Jinping, with Kai-Fu Lee and the country’s tech majors leading the charge. However, analysts in Asia I have spoken to pushed back at the characterization about perceived passivity in the rest of the region. They pointed out that Japan and the tiger economies of South Korea, Taiwan and Singapore are at the vanguard of manufacturing semiconductors, the integrated circuits that supply the computing power needed to analyze massive amounts of data from large language models (LLMs).

While Japan and the tigers are indeed critical elements of the global semiconductor supply chain, which is splintering due to rising U.S.-China tensions, a huge swathe of the the Asian region appears unmoved with what looks like momentous shifts in the global economy.

Asian democracies like India, Indonesia, the Philippines, and economic powerhouses like Vietnam rely to a great extent on trade and investment to juice their economies and create jobs. Policymakers need to worry about what would happen if AI proves to be a job destroyer, just at a time when they are at a sweet spot in terms of demographics. While there is a possibility that the current AI mania, like crypto and many others before it, just turns out to be hype, the profound question is whether Asian governments can afford to take that chance.

Which is why the region’s governance platforms—ASEAN, APEC, East Asia Summit—need to move beyond publishing policy briefs and actively engage at the political level on how to manage the economic boon (which AI is likely to provide to their economies) and in dealing with the social risks. An AI-induced revolution may still be in the realm of science fiction but there is a real possibility of massive future unrest as a result of major structural shifts in jobs and livelihoods. Asian leaders need to wake up and step on the policy accelerator.