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AI spending in Asia Pacific to reach US$32 billion in 2025: IDC

The banking, government and professional services sectors are expected to be the top spenders of AI in the next few years.

The International Data Corp (IDC) expects businesses in Asia Pacific (excluding Japan) to collectively spend US$32 billion (S$43.6 billion) on artificial intelligence (AI) in 2025, up from US$17.6 billion (S$24 billion) this year.

The banking industry is expected to drive the bulk of the AI spending as banks in the region increasingly leverage the technology for augmented threat intelligence and fraud analysis applications.

State/local governments will be the second-highest spender, focusing on public safety and emergency response, augmented threat intelligence, and prevention systems.


Professional services firms will also be investing heavily in AI in the next few years. The key focus area is augmented customer service agents, which help resolve customer issues. Smart business innovation and automation will optimise and streamline complex and repetitive business tasks to support organisational decision-making.

IDC forecast for Asia Pacific's AI speding
IDC forecast for Asia Pacific's AI speding

Chart: IDC

“Many of the changes caused by the pandemic will stay, and we expect the adoption momentum of practical AI use cases such as remote or contactless engagement to continue. In the long term, clear guidance on managing the associated risk factors of AI solutions will further boost the confidence level of buying organisations,” says Jessie Danqing Cai, associate research director for Cognitive Computing/Artificial Intelligence at IDC Asia/Pacific.

Vinayaka Venkatesh, senior market analyst at IDC IT Spending Guides for Customer Insights & Analysis, adds: "Increasing government regulations and mandates of AI's trust, robustness, and its ethical use will need to be addressed by organisations. Customer-facing industries such as financial services, hospitality and tourism will take the lead in addressing these government mandates."

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