A new economic forecast from Japanese investment bank Nomura indicates artificial intelligence will serve as a primary catalyst for economic expansion across the Asia-Pacific region through 2026. The bank’s Asia Macro Outlook 2026 report projects regional GDP growth of 3.7% by end-2025, followed by 3.6% expansion in 2026, driven substantially by robust global demand for computing infrastructure and semiconductor components.
Rob Subbaraman, Nomura’s head of global macro research, characterized 2026 as a period that will ‘shine a brighter light on Asia’ during a Hong Kong press briefing. He highlighted that Asia’s strong economic fundamentals would attract increased capital inflows amid growing global investment diversification trends. However, Subbaraman emphasized significant regional variations, noting that ‘2026 is also a year of differentiation’ across Asian economies.
According to Sonal Varma, Nomura’s chief economist for India and Asia ex-Japan, technology exports are poised to accelerate substantially, primarily fueled by sustained spending from cloud service providers. ‘AI demand will remain quite strong,’ Varma stated, indicating this trend would prove ‘fairly positive for the big tech exporters in the region.’ The report specifically identifies Malaysia, Singapore, and South Korea as likely outperformers benefiting most from the AI boom.
The outlook remains positive for Japan, where a recently announced ¥21.3 trillion stimulus package is expected to boost consumer spending. Nomura also anticipates a forthcoming US-India trade agreement that would support India’s 2026 growth trajectory.
Euben Paracuelles, Nomura’s chief economist for Southeast Asia, presented a ‘very bifurcated outlook’ for the subregion. While expressing bullish sentiment toward Malaysia and Singapore’s growth prospects, he projected disappointing performance from Indonesia, Thailand, and the Philippines. Paracuelles cited political uncertainty in Thailand and the Philippines, alongside a corruption scandal affecting flood control projects in the latter, as factors constraining fiscal spending and GDP growth.
The analysis further noted that structural reforms and AI-related demand would continue benefiting Singapore and Malaysia, with major initiatives like the Johor-Singapore Special Economic Zone boosting construction and investment activity. While ASEAN members attempt to mitigate global economic uncertainty through enhanced intra-regional trade, Nomura expressed skepticism about the bloc’s ability to overcome existing trade barriers based on historical performance.