A critical opportunity emerges to strengthen the world’s largest trade agreement amid rising global uncertainty and fragmentation. Although regional integration has improved, utilisation remains uneven, particularly among ASEAN members.

Buy-now-pay-later (BNPL) and other platform-based lending services are expanding rapidly across Southeast Asia, driven by high smartphone use, underbanked populations, and integration with e-commerce platforms. While these systems offer convenient access to credit, automated decision-making can allow risk exposure to accumulate before traditional metrics detect problems.

ASEAN enters 2026 at a pivotal moment as Philippines assumes the ASEAN Chair amid evolving geopolitical and regional dynamics. Strategic competition between the United States and China continues to shape the region’s economic and political landscape, while internal challenges, including Myanmar’s instability and regional tensions, persist. At the same time, ASEAN is advancing initiatives in digital integration and energy cooperation, while expanding partnerships with actors such as Japan and the European Union to support stability and regional development.

Despite a turbulent 2025 marked by stalled efforts on Myanmar and renewed border tensions between Cambodia and Thailand, ASEAN demonstrated the resilience and global relevance of its partnership model through two major milestones: Timor-Leste’s accession as its 11th member and the substantive agreement of the ASEAN Digital Economy Framework Agreement (DEFA).

Southeast Asia’s AI sector is entering a rapid growth phase, supported by strong government backing, rising digital adoption, and a young talent base. The AI market is projected to grow from US$4.3 billion in 2024 to over US$17 billion by 2033, with adoption potentially adding up to US$1 trillion to regional GDP by 2030.

Russia’s recent push to deepen ties with Southeast Asia—from expanded defence cooperation with Indonesia to arms, energy and security engagements across the region—reflects Moscow’s ambition to position itself as a great-power partner alongside the US and China.

ASEAN is entering a critical period as shifts in global production networks, digitalisation, and the green energy transition reshape labour markets and create new opportunities in sectors such as artificial intelligence, semiconductors, renewable energy, and advanced manufacturing.

ASEAN in 2025 is navigating a convergence of geopolitical rivalry, shifting trade dynamics, and accelerating energy transition, while integrating new members and responding to internal crises.

ASEAN stands at a pivotal moment as global interest in central bank digital currencies (CBDCs) accelerates, with most central banks worldwide now conducting experiments or pilots.