Asia among most vulnerable to AI correction, Asean unit warns
The Asean+3 Macroeconomic Research Office warns that Asian economies are highly vulnerable to a potential collapse in the AI sector. The region's deep integration into global AI supply chains and financial markets could lead to significant economic shocks if the current AI boom corrects.
Why it matters
A downturn in the AI sector could trigger widespread financial instability and economic contraction across major Asian manufacturing hubs.
BURSA SGX Home Tech Make The Edge Malaysia your preferred source on Google (Oct 5): Southeast Asia plus China, Japan and South Korea are more at risk than most economies to any potential collapse in the artificial-intelligence boom, which could trigger shocks across financial markets and the real economy.
The region is “particularly exposed” because it’s at the centre of global AI supply chains and “increasingly integrated into AI-related financial markets,” the Asean+3 Macroeconomic Research Office said in its 2026 Financial Stability Report published on Monday.
“A disorderly correction could therefore propagate through multiple channels — including lower technology exports, portfolio losses, capital outflows, refinancing pressure on leveraged technology and infrastructure firms, and weaker investor confidence,” it said.
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