The International Monetary Fund (IMF) has revised its economic growth forecasts for major Southeast Asian economies, highlighting the impact of increased investment in artificial intelligence (AI) and technology infrastructure. According to the IMF’s latest World Economic Outlook report, these economies, including Indonesia, Malaysia, the Philippines, Singapore, and Thailand, are collectively expected to grow by 4.4% in 2026. This marks an improvement from the previous estimate of 4.1%, driven by investments in data centers and other infrastructure supporting the global AI boom.
Globally, the IMF projects economic growth of 3.1% in 2026, slightly up from the July forecast of 3%. The growth forecast for 2027 remains at 3.4%, following a 3.5% increase in 2025. The organization notes that technology-related investments are bolstering global growth by enhancing demand and exports in countries linked to high-tech supply chains. However, economies heavily reliant on energy imports and with limited technology sector exposure face challenges such as higher costs, reduced purchasing power, and constrained government budgets.
China’s economic growth projection for 2026 has been slightly downgraded to 4.5%, down from the 5% growth recorded in 2025. The adjustment reflects ongoing pressures from higher global oil prices and prolonged uncertainty affecting its economic outlook.
The report also raises concerns about global inflation, which is expected to rise to 4.7% in 2026 from 4.1% in 2025, largely due to increased energy and food costs. Inflation is anticipated to ease back to 4.1% by 2027.
The IMF warns that various global risks could threaten economic stability, including prolonged conflicts in the Middle East, trade tensions, and financial market volatility. It advises governments to ensure that support measures aimed at mitigating rising energy and food costs are temporary and targeted, so as not to undermine public finances.