Source: cyprus-mail
Asia-Pacific AI spending set to reach $370bn by 2029
International Data Corporation (IDC) projected that artificial intelligence and generative AI spending in Asia-Pacific will rise from 73 billion dollars in 2024 to 370 billion dollars by 2029, marking a fivefold increase driven by rapid enterprise adoption.
The report highlights a compound annual growth rate of 38.4 per cent, reflecting accelerating investment across industries in the region, including China and Japan.
Within this expansion, generative AI is emerging as the fastest-growing segment, expected to reach approximately 175 billion dollars by 2029.
This represents a 68.2 per cent compound annual growth rate, with generative AI accounting for 47.4 per cent of total AI spending in the region.
The findings indicate a clear shift from early-stage experimentation to enterprise-wide operationalisation of AI technologies.
IDC said that total AI investment in Asia-Pacific is expected to reach 370 billion dollars by 2029, underlining the scale of transformation underway.
Growth is being fuelled by enterprise demand for scalable infrastructure, operational efficiency, and AI-enabled applications.
At the same time, challenges related to governance, cost, and system integration continue to influence the pace and structure of adoption.
A significant portion of spending is directed towards AI infrastructure provisioning, which accounts for approximately 39 per cent of total investment.
“The Asia-Pacific AI market has shifted from an infrastructure-building phase to one defined by platform consolidation and operational depth,” said IDC Asia-Pacific senior market analyst for data and analytics Vinayaka Venkatesh.
“Organisations are prioritising AI platforms that unify generative, predictive, and prescriptive capabilities, with increasing focus on AI agents and orchestration to scale enterprise-wide adoption,” he said.
IDC noted that the market transformation is being driven by a convergence of enterprise priorities, including the need to manage increasingly complex workloads.
Companies are also investing heavily in hyper-personalised customer experiences and improved operational efficiency through AI integration.
Rising demand for real-time analytics and advanced security intelligence is further reinforcing AI as a core business capability.
The emergence of agentic AI is reshaping enterprise systems, enabling autonomous functionality within applications and platforms.
This shift allows organisations to move from assisted decision-making towards autonomous execution across workflows.
IDC expects continued strong growth as businesses transition from isolated AI use cases to fully integrated enterprise ecosystems.
Future investment is likely to focus on platforms supporting orchestration, governance, and scalability.
However, the report warns that cost pressures, regulatory compliance requirements, and skills shortages may moderate adoption in certain markets.
Across industries, AI adoption in Asia-Pacific is expanding both in depth and scope, with significant uptake across multiple sectors.
The software and information services sector remains the largest contributor, accounting for more than 47 per cent of AI spending in 2026.
This is driven by investment in development platforms, training infrastructure, and intelligent applications.
In financial services, organisations are extending AI use beyond traditional areas such as risk management and fraud detection.
They are increasingly adopting autonomous advisory systems, compliance automation, and real-time decision-making tools.
Meanwhile, telecommunications and retail sectors are embedding AI into core operational functions, including network management and customer engagement.
Applications include predictive network optimisation, intelligent customer routing, demand forecasting, dynamic pricing, and personalised commerce.
AI infrastructure provisioning continues to dominate as the largest use case, supported by sustained investment in accelerated computing, cloud-native services, and data centre capacity.
At the same time, conversational AI and virtual assistants are evolving rapidly, enabling more advanced and context-aware interactions.
These systems are increasingly capable of multi-turn conversations and scalable self-service solutions.
In the public sector, AI is gaining traction in national security and emergency response applications.
Governments are deploying technologies for surveillance, predictive threat detection, and real-time data integration.
These capabilities are enhancing situational awareness and crisis response outcomes across the region.IDC’s outlook underscores that Asia-Pacific is becoming a global leader in AI investment and innovation, as organisations accelerate their transition towards data-driven and automated operations.