Jakarta, INTI - Despite the rapid adoption of artificial intelligence (AI) among businesses across Southeast Asia, this growth is not matched by comparable levels of readiness and investment commitment among countries in the region.
These findings were highlighted in the inaugural BT Insights report, as cited on Thursday, June 18, 2026. The report, published by The Business Times, maps the AI transformation readiness of companies across Indonesia, Singapore, Malaysia, Thailand, the Philippines, and Vietnam.
According to BT Insights, companies in the region are broadly divided into three main categories. Around 45% of respondents are classified as AI First Movers, representing firms experiencing both high transformation pressure and strong AI adoption momentum.
Another 42% fall under Pragmatic Optimisers, companies that adopt AI more selectively, focusing on efficiency and use cases that deliver measurable results.
Meanwhile, 13% are categorized as Cautious Traditionalists, reflecting organizations that remain hesitant to adopt AI due to concerns over costs, operational disruption, and uncertain investment returns.
The report notes that the pace of AI transformation in Southeast Asia varies significantly across countries. Indonesia records the highest share of AI First Movers at 62%, surpassing Thailand (55%), the Philippines (47%), Malaysia (46%), Singapore (36%), and Vietnam (28%).
In contrast, Vietnam has the largest proportion of traditional firms, with 51% of respondents classified as Cautious Traditionalists, indicating a substantial digital readiness gap within ASEAN countries.
Indonesia also experiences the highest level of transformation pressure in the region, with 70% of companies reporting moderate to strong pressure to adapt to emerging technologies such as AI, automation, and sustainability trends.
This figure leads the region, followed by the Philippines and Singapore at 69% each, Thailand at 61%, Malaysia at 49%, and Vietnam at 39%.
Although AI adoption continues to rise, the report reveals that most Southeast Asian companies are still focused on building foundational technologies before scaling implementation.
About 51% of respondents plan to prioritize investments in 2026 for data infrastructure and platform development. This is followed by risk management and compliance (42%), as well as customer analytics and service personalization (40%).
In Indonesia, investment priorities are similarly centered on infrastructure and data platforms, accounting for 54% of total focus. Companies are also increasingly allocating resources to research and product development, business process automation, and supply chain optimization.
High Costs Remain the Main Barrier to AI Adoption
Despite strong interest in AI, implementation costs remain the biggest challenge for companies across Southeast Asia. In Indonesia, 58% of firms cite the high cost of AI tools, infrastructure, and deployment as the primary barrier to adoption.
Other challenges include difficulties integrating AI with legacy systems (42%), limited internal capabilities to scale AI implementation (38%), and insufficient data quality (33%).
Beyond cost-related challenges, the survey shows that more than half of companies in the region expect generative AI (GenAI) to have a significant to very significant impact on operations and manufacturing by the end of 2026.
In Indonesia, expectations for this disruption are among the highest in the region. AI is increasingly viewed not merely as a productivity tool, but as a structural force that will fundamentally reshape how organizations operate.
Conclusion
AI adoption in Southeast Asia is accelerating, but significant gaps remain in readiness, investment capacity, and infrastructure across countries. While Indonesia leads in AI-first movers and transformation pressure, high implementation costs, legacy system integration issues, and limited internal capabilities continue to slow broader deployment. Moving forward, addressing these barriers will be critical to unlocking AI’s full potential as a transformative force for regional productivity and economic growth.
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