KUALA LUMPUR (July 27): Asean economic growth will likely come in stronger than expected this year thanks to resilient exports of semiconductor and electronics, a multilateral office said on Monday.
The 10-member region’s growth may expand 4.8% this year with Malaysia, Singapore, Thailand and Vietnam set to grow faster than previously thought, according to the Asean+3 Macroeconomic Research Office (Amro). That compares to Amro’s June projection of 4.6% growth.
Asean+3, which also includes Japan, South Korea, and China, could also pick up slightly supported by “firm domestic demand and its central role in global AI supply chains”, said Amro chief economist Dong He at a virtual media briefing.
Malaysia’s growth forecast was raised to 4.9% in 2026 from 4.6% while Singapore’s estimate was lifted to 4.8% from 3.4% after both economies performed better than projected in the second quarter.
Manufacturing activities, in particular, picked up in Malaysia and Singapore, driven by output increases in the electronics segment amid strong demand for semiconductors.
However, Amro cautioned that risks from elevated energy and input costs continue to affect inflation and industrial activity in Asean+3 as well as weaker-than-expected technology demand that could weigh on regional exports and investment.
Given the importance of AI-related demand to the regional outlook, “even a moderate slowdown” in global technology investment could slow Asean+3 growth, the office warned.
“The wide range of plausible outcomes underscores the importance of continued vigilance and sound macroeconomic policies,” He added. “Policymakers will need to respond flexibly to differing domestic conditions and rapidly evolving external risks, particularly the AI cycle and the Middle East conflict.”