MANILA — The Philippines ranks 43rd out of 47 countries in a global Artificial Intelligence (AI) Economic Impact Index, placing it among the world’s lowest performers in harnessing AI, according to London-based think tank Capital Economics.

The report gave the Philippines a score of 21 out of 100, trailing all ASEAN-5 peers: Singapore (2nd globally), Malaysia (31st), Thailand (37th), and Indonesia (41st). The country joins Mexico, South Africa, Ukraine, and Argentina in the bottom five nations.

Economists Carl Gunvaldsen and Vicky Redwood of Capital Economics warned that the Philippines may be particularly vulnerable to the impact of AI on the business process outsourcing (BPO) sector, a key driver of its economy. India faces similar risks due to its reliance on English-speaking BPO workforces.

The report noted that AI adoption in manufacturing, such as software operating industrial robots, could displace assembly workers across many emerging markets.

Globally, the United States leads the index with 72 points, followed by Singapore (59) and the United Kingdom (55). China made a notable jump from 17th in 2024 to 7th in 2026, reflecting stronger diffusion of AI across its economy.

Capital Economics highlighted that emerging markets outside Asia tend to rank lower, as AI adoption alone cannot compensate for structural challenges such as weak governance and institutional inefficiencies.

“We assume that the countries that score highest on our AI index will generally see the biggest productivity gains from AI over the next couple of decades,” the think tank said, while cautioning that productivity benefits may be uneven, even in countries with high AI adoption.

The findings underscore the need for the Philippines to accelerate AI adoption, innovation, and infrastructure to remain competitive in the rapidly evolving global digital economy.