AI-driven productivity gains may help offset Asia’s demographic challenges from aging population

BANGKOK, 12 OCTOBER 2026 —

Artificial intelligence could help offset Asia's shrinking workforce as some countries in the region face rapid population ageing, provided that the adoption of the technology is scaled evenly rather than deepening existing economic disparities, the International Monetary Fund said on Monday.

Speaking at the launch of a new IMF book examining the economic challenges and opportunities facing Asia, IMF Managing Director Kristalina Georgieva identified demography, economic integration, and technology, specifically artificial intelligence, as the three major transformations shaping the region.

According to findings presented in the book and highlighted during the event, countries such as China, Japan, and South Korea could lose nearly 25% of their working-age populations between now and 2050. This steep decline threatens to constrain overall economic activity as fewer workers remain available to support production and growth.

Georgieva noted that artificial intelligence is projected to lift economic growth in advanced Asian economies, where ageing populations are placing the greatest pressure on labour supply, by somewhere between half a percentage point and one percentage point.

She stated that if these countries successfully capture productivity and this associated growth, they will more than offset the demographic pressure currently bearing down on their economies. The extent of these benefits, however, will ultimately depend on how effectively individual nations adopt the technology and convert productivity improvements into broader economic gains.

Addressing the structural risks at the book launch, which took place as part of the IMF and World Bank annual meetings in Bangkok, Krishna Srinivasan cautioned that policymakers must carefully balance the potential benefits of artificial intelligence adoption against the threat of a widening economic divergence across countries in Asia.

Srinivasan, who serves as the director of the IMF's Asia and Pacific department, emphasized that the ultimate impact of the technology will depend on whether it serves to augment workers or simply automate their jobs.

Elaborating on the regional divide, Srinivasan noted that advanced economies are more exposed to artificial intelligence for sure, but they are also significantly better placed to benefit from it. In contrast, emerging markets face lower exposure to the technology, but they are correspondingly less in a position to capture the upside without targeted intervention.

To bridge this gap, Srinivasan highlighted that the good news here is that reforms which raise skills and productivity can bring adoption forward by a decade or more, helping nations better prepare for structural technological shifts.

Alongside technological transformation, Georgieva also pointed to the substantial economic advantages of enhanced trade cooperation within the region. She stated that deeper regional trade agreements and a concerted reduction in non-tariff barriers could raise Asia's gross domestic product by about 1.8% in the long run.

The remarks delivered in Bangkok underscore a multi-pronged approach for Asian policymakers, highlighting that artificial intelligence adoption, targeted workforce skills development, and regional trade cooperation are the critical pillars determining the region's ability to sustain long-term economic growth amid sweeping demographic and technological shifts.

Related: Bangkok