East Ventures, a venture capital firm in Southeast Asia, has released its market outlook for 2025. The report presents a measured yet optimistic vision for the region’s digital economy and outlines key projections that offer insights into global and regional economic trends, technological adoption, and entrepreneurial strategies.

According to the organisation, tech innovation will play a pivotal role in shaping growth. East Ventures foresees a surge in AI-first startups, with approximately 25 per cent of businesses projected to adopt Generative AI (GenAI) and AI agents by 2025.

This figure is expected to double by 2027, reflecting the rapid pace of AI integration across industries.

Global economic growth is projected to stabilise at approximately 3.1 per cent over the next five years. This marks a resilient recovery following the disruptions caused by the pandemic, supported by advancements in tech and the emergence of new industries.

However, the rise of protectionist policies in major economies could reconfigure patterns of global economic interdependence, underscoring potential challenges ahead.

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The digital economy in Southeast Asia is expected to expand significantly in 2025. Strong domestic consumption, a rebound in tourism, and improved investment flows are anticipated to drive this growth.

Additionally, the US Federal Reserve’s recent rate cut in September will likely provide further momentum, benefitting both businesses and consumers in the region.

Climate tech remains significant

The report also highlighted the sectors set to be popular in 2025.

In the healthcare sector, the adoption of AI is expected to accelerate, revolutionising patient care and clinical workflows. AI applications, such as real-time diagnostics and the development of personalised treatment plans, are anticipated to become standard practice.

These innovations aim to enhance accuracy in medical decision-making while reducing time and resource demands on healthcare providers.

Climate tech remains a priority for East Ventures, with significant momentum projected in areas such as renewable energy optimisation and carbon tracking. The firm emphasises the critical importance of climate tech as a means to address sustainability goals. By improving energy efficiency and providing tools to monitor and reduce emissions, this sector is expected to play a pivotal role in combating climate change.

Consumer tech, particularly e-commerce, is also undergoing rapid evolution. The rise of personalised shopping experiences and automated customer service through AI-powered chatbots signals a shift towards more tailored and efficient consumer interactions.

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Additionally, businesses are expected to increasingly adopt smart solutions to streamline operations, driving productivity and cost savings in the retail sector.

Beyond the numbers, in this report, East Ventures stresses the importance of creating a “believable Southeast Asia,” positioning the region as a global economic powerhouse.

The firm urges entrepreneurs to shift their focus from following fleeting trends to addressing real-world problems and delivering tangible value. By fostering sustainable and impactful solutions, founders can navigate economic uncertainties and contribute to the region’s long-term prosperity.

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Image Credit: East Ventures

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