A surplus of the working-age population, mainly between 15 and 64, brings innovation and adaptability.
These are key traits that can significantly boost economic productivity. Southeast Asia’s large youth workforce, ongoing digitalization, rising AI adoption.
And increasing investments in AI infrastructure and startup ecosystems are turning this moment into a golden window to position the region as a global digital economic powerhouse.
The Demographic Dividend in Southeast Asia
Shifts in age structure offer long-term economic potential. The upcoming demographic dividend is a key driver for accelerating digital economic growth.
A “demographic dividend” refers to the booming number of people in productive age due to long-term fertility decline.
According to ESCAP Population Data Insights, the population across Asia and the Pacific in 2024 stands at 4.8 billion, around 60% of the global population.
And is projected to rise to 5.2 billion by 2050. In Southeast Asia, the number is expected to hit 774.6 million by 2050.
Even though the population keeps growing, the growth rate is slowing. In 2024, Southeast Asia’s annual population growth was 0.73%, and it is projected to decline to 0.70% by 2025.
By 2050, 19.0% of Southeast Asia’s population will be 0–14, while 16.3% will be 65 and above.
This is a sharp shift from 2023, where 24.3% were aged 0–14, 67.6% were in the 15–64 working group, and only 8.1% were 65+.
Southeast Asia is undergoing a demographic transition, with a shrinking young population and a rapidly growing elderly population post-bonus era.
Turning the Demographic Dividend into a Digital Economy Advantage
A tech-savvy generation will lead the way in adopting and advancing digital technologies. So why does this demographic moment matter for digital growth?
Southeast Asia’s digital economy is booming, especially in e-commerce, digital finance, and online media.
A joint report by Google, Temasek, and Bain & Company forecasts that Southeast Asia’s e-commerce GMV (Gross Merchandise Value) will hit $159 billion by 2024.
Digital financial services (DFS) are also set to soar, with revenues expected to rise by 22% to $33 billion in the same year.
Meanwhile, the World Economic Forum predicts Southeast Asia’s digital economy could reach $1 trillion in GMV by 2030.
Internet usage is also surging; by early 2023, over 70% of Southeast Asia’s population was online. The region’s average age is around 30, and youth dominate the digital space.
Southeast Asia is a major player in AI innovation and adoption, offering a vast market for AI-driven products and services.
Digital platforms, including social media, are also helping U.S.-based companies connect and engage with Southeast Asian consumers, boosting brand visibility significantly.
Read also: Shopee: The E-Commerce Giant Changing the Face of Online Shopping in Southeast Asia
The demographic bonus is a one-time chance that Southeast Asian countries must not overlook. The digital-native generation will drive the transformation toward a stronger digital economy.
But there are challenges: an aging population could shift the bonus into a demographic burden.
Many rural areas still face digital inequality due to limited Internet access and low digital literacy.
Can Southeast Asia truly seize this moment without strategic collaboration between governments, investors, and communities, especially as the digital divide continues to widen? Let’s see.
References:
IP & Legal Filings. (n.d.). The Rise of the Digital Economy in South East Asia: Opportunities and Challenges. ipandlegalfilings.com/the-rise-of-the-digital-economy-in-south-east-asia-opportunities-and-challenges/
World Economic Forum. (2023). How Southeast Asia Can Become a Trillion Dollar Digital Economy. weforum.org/stories/2023/12/how-southeast-asia-can-become-trillion-digital-economy/
Kajimura, H. (2020). The Digital Economy in Southeast Asia: Opportunities and Challenges. iseas.edu.sg/wp-content/uploads/2020/06/ISEAS_EWP_2020-5_Kajimura.pdf
Asia Pacific Population Trends. (n.d.). Data: Southeast Asia. population-trends-asiapacific.org/data/sea
Kompas.com. (2022). Pengertian Bonus Demografi dan Manfaatnya. kompas.com/skola/read/2022/12/21/080000069/pengertian-bonus-demografi-dan-manfaatnya
Bain & Company. (2024). e-Conomy SEA 2024. bain.com/about/media-center/press-releases/sea/e-conomy-sea-2024/
Jurnal Pustaka Cendekia. (n.d.). Bonus Demografi di Asia Tenggara: Peluang atau Tantangan? jurnalpustakacendekia.com/index.php/jca/article/view/130/160
Arden Jaya. (n.d.). Pengaruh Bonus Demografi terhadap Pertumbuhan Ekonomi Digital di ASEAN. jurnal.ardenjaya.com/index.php/ajsh/article/view/644/565
CNBC Indonesia. (2023). Bonus Demografi, Mesin Pertumbuhan Ekonomi ASEAN. cnbcindonesia.com/research/20230906140454-128-469890/bonus-demografi-mesin-pertumbuhan-ekonomi-asean
