AI adoption drives Philippines’ digital economy growth, Google says
The Philippines is witnessing a dramatic rise in interest and adoption of artificial intelligence (AI). During the launch of e-Conomy SEA (Southeast Asia) report 2024 at Google Philippines headquarters in Taguig City, Philippines, representatives from the tech giant and Bain & Company discussed the growth of the digital economy in the region, including the role of AI.
Nikki Del Gallego, Data and Insights Lead at Google Philippines, highlighted the explosive growth in AI-related searches. “We’ve seen an 11x growth in AI-related search interest across the region in the past few years, but the Philippines has grown an astounding 23x during that same period,” Del Gallego shared. This surge is not confined to the country’s capital region, Metro Manila. “In areas like Davao, Central Luzon, and Calabarzon, AI interest is burgeoning, showcasing how digital innovation is reaching across the nation.”
The growing curiosity stems from AI’s diverse applications in education, marketing, gaming, and mobile apps. “From transforming the way Filipinos learn to empowering businesses with AI-driven strategies, this technology is already reshaping industries,” Del Gallego emphasised. With platforms embedding AI features like content creation and chatbots, Filipinos rapidly integrate AI into their daily lives.
Digital economy thrives on AI
AI’s impact on the broader digital economy is evident in the Philippines’ robust online media and e-commerce sectors. Bennett Aquino, Partner at Bain & Company, noted how AI enhances profitability and business user engagement.
“E-commerce players are leveraging AI to optimise promotional strategies and manage marketing costs. Video commerce and in-app ads are becoming essential tools to drive growth,” Aquino stated. This extends to travel, where AI-driven solutions have boosted post-pandemic spending. “Philippine digital travel spending has grown by an astounding 450 percent since 2020, with a significant chunk directed to Asia-Pacific destinations like Japan and Singapore,” he added.
The gaming industry is another key beneficiary, with the Philippines poised for growth alongside Vietnam in casual game development and downloads. “Our region punches above its weight in gaming, with Southeast Asia accounting for 12 percent of global game downloads,” Aquino said.
Digital financial services also play a pivotal role in this landscape. “AI-powered credit scoring is making loans more accessible for SMEs (small and medium-sized enterprises) and underbanked Filipinos. Digital payments, led by players like GCash and Maya, are expected to grow to $125 billion in gross transaction value, up 22 percent from last year,” Aquino shared.
Building digital trust: A collective responsibility
As AI adoption accelerates, fostering digital trust has become paramount. Jackie Wang, Country Director for Google Thailand and Philippines, stressed the need for robust measures to protect user data and promote cybersecurity.
“Accidental data exposure and cyberattacks undermine user trust. Businesses must prioritise security measures and transparency, while governments need to balance digital economy growth with strong protections against cyber risks,” Wang said. Empowering consumers with knowledge and vigilance is equally critical. “Teaching users how to safeguard themselves is a must,” she added.
Wang pointed to the Philippines’ National AI Roadmap as a beacon of ethical AI implementation. “The government’s proactive stance, coupled with widespread English proficiency and high smartphone penetration, positions the Philippines as a leader in AI development,” she noted.
The road ahead: Unlocking AI’s full potential
With a young, tech-savvy population and a supportive regulatory environment, the Philippines is primed for AI-driven innovation. Google’s recent rollout of the Gemini Quest app in the Philippines underscores this potential.
“The Philippines serves as an ideal testbed for AI products. Businesses need to align AI strategies with goals, invest in diverse talent, and prioritise data quality and ethical considerations,” Wang explained. On the government side, fostering research and promoting open-source technology are vital. “The recent AI Essentials Skilling Program is a testament to our collaboration with the government in driving inclusive growth.”
The synergy between AI adoption and digital trust will define the Philippines’ trajectory in the digital economy. As Del Gallego put it, “This is a moment of transformation, with the Philippines leading the way in leveraging AI for inclusive and sustainable growth.”
