The state of development in Southeast Asia

As of 2024, Southeast Asia is a home to approximately 687 million people (IMF, 2024) and stands as a region of impressive religious diversity, rich culture and deep history. Southeast Asia consists of 11 countries that span from the mainland to the insular Southeast Asia: Thailand, Myanmar (Burma), Laos, Vietnam, Cambodia, Malaysia, Singapore, Indonesia, the Philippines, Brunei and Timor Leste. Though these countries share geographical proximity, their economic structures, levels of development, and political systems vary significantly.

Economic growth and performance

Southeast Asia has experienced robust economic growth in recent decades and yet the level of economic development varies across the region. Some countries in the region have experienced inclining growth after the COVID-19 pandemic in 2021. For instance, Singapore’s economy expanded to 4.4% GDP growth in 2024, faster than the 1.8% expansion in 2023, mainly driven by its robust wholesale trade, finance and insurance, and manufacturing sector (MTI Singapore, 2025). Other countries, such as Malaysia, Indonesia, the Philippines and Vietnam, achieved 5% GDP growth in 2024, while Thailand experienced a lower growth rate of 2.5% (McKinsey, 2025).

Malaysia and Thailand’s growths are primarily driven by strong investment activities, increased exports, and sustained domestic spending. Indonesia, the largest economy in Southeast Asia and a G20 member, relies heavily on its natural resources, industrial activities, and commodity trade.

Among the emerging economies, Vietnam has experienced rapid growth over the past few decades, driven by strong exports, expanding industrial outputs, and robust foreign investment inflows. The Philippines is in the development phase with its services sector contributes around 60-65% of the country’s GDP.

Apart from the growth aforementioned, other Southeast Asian countries continue to face challenges in economic development due to heavy reliance on the fluctuating oil and gas sector, limited economic diversification strategy, lack infrastructure development and investment, internal political instability, and low human development indices.

Regional integration and trade

Ten countries in Southeast Asia, excluding Timor Leste, are actively engaged in economic, social and cultural cooperation through the regional intergovernmental organisation ASEAN, or the Association of Southeast Asian Nations, which was founded in 1967. ASEAN aims to promote peace and stability in the region while strengthening cooperation to remove trade barriers and foster investment for a more integrated and competitive regional economy (ASEAN, 2025). ASEAN has also expanded its strategic partnerships beyond the region by establishing diplomatic ties with major global economies, including the United States, United Kingdom, China, Japan, and the European Union. In 2024, Southeast Asia recorded strong trade growth, particularly in increased demand for electronics from key trading partners such as China and the United States (McKinsey, 2025).

Infrastructure development and urbanisation

Infrastructure development in Southeast Asia has progressed unevenly across different countries. Advanced infrastructure to support industrialisation and economic growth is evident in capital cities such as Singapore and Kuala Lumpur, while significant investments in infrastructure have driven rapid development in large cities such as Jakarta, Manila and Ho Chi Minh City. Rapid urbanisation is experienced in Indonesia, Vietnam and the Philippines, which led to challenges such as traffic congestion, pollution, and the need for affordable housing and public services. These challenges require special attention from the governments to be addressed. One of Southeast Asia’s largest economies, Indonesia, is currently in the development process of its new capital city, Nusantara, to relocate its government administration and promote more equitable distribution of wealth and activities (McEwan and Skinner, 2024). According to the Asian Development Bank, infrastructure development in Southeast Asian countries is forecasted to grow from USD 2.8 trillion to USD 3.1 trillion between 2016 and 2030, with the highest number of infrastructure projects recorded in Indonesia, Thailand, and the Philippines (SEAISI, 2023).

Political stability and types of government

Political stability varies widely across Southeast Asia, affecting both economic development and foreign investment. According to the Political Stability Index developed by the Global Economy (2023), Singapore, Brunei, Laos, Malaysia and Cambodia experience positive political stability, with Singapore leading the region with the highest rate of 1.42 points, followed by the other four countries consecutively. On the other hand, negative political stability rate from the least to the most unstable is recorded by Vietnam, Thailand, Indonesia, the Philippines, and Myanmar (Burma). A lower rate indicates a higher likelihood of issues such as disorderly government transition, armed conflicts, social unrest, terrorism, as well as ethnic, religious or regional conflicts.

In terms of government types, some countries in the region have adopted democratic system in their presidential republic, parliamentary system or constitutional monarchy. These countries are the Philippines, Indonesia, Singapore, Malaysia, and Timor Leste (Kofi Annan Foundation, 2017). Brunei is an absolute monarchy, Thailand and Cambodia are constitutional monarchies, while Vietnam and Laos operate as single-party socialist republics. On the other hand, Myanmar (Burma)’s transition to democracy was overthrown in 2021 and the country is currently ruled by the military (Epstein, 2024).

Development of education

All Southeast Asian countries have legal provisions for compulsory education at certain levels of basic education. The most common education structure in the region is 6+3+3, followed by a 6+4+2 system (UNESCO, 2014). Higher education has become more accessible in Southeast Asia, with greater number of higher private education institutions benefiting students from higher socioeconomic backgrounds (Lim et al., 2022). According to data from UNESCO’s World Inequality Database on Education, factors such as socioeconomic status, urban-rural location, and gender significantly influence higher education participation. In general, people living in or around urban areas and female young adults recorded higher participations in tertiary education. Unequal access to higher education in some parts of the region is still a challenge to overcome. However, as technology advances, online learning opportunities have expanded the access to higher education across the region (Lim et al., 2022).

Environmental sustainability

Environmental sustainability efforts in Southeast Asia primarily focus on climate action (SDG 13), life on land and water (SDG 14 and 15), and promoting sustainable energy (SDG 7) and consumption practices (SDG 12). The region is actively working to balance economic development with environmental protection. However, major challenges such as pollution, deforestation, rising sea levels and extreme weather events (e.g., typhoons, floods) due to climate change remain as issues to be solved.

In the transition towards clean energy (SDG 7), many Southeast Asian countries still rely heavily on coal, fossil fuels and natural gas for their energy needs. Nonetheless, there have been growing efforts to shift toward renewable energy. For instances, Vietnam, Thailand, Indonesia, and the Philippines have made strides in renewable energy production with development projects of solar photovoltaic, hydropower plants, wind energy, bioenergy, and geothermal energy resources (SEA Public Policy Institute, 2025).

As regards with SDG 12, the region has a regional guideline for sustainable agriculture that promote a circular economy, aiming to reduce waste, encourage resource circularity and foster stewardship in resource use (ASEAN, 2022). On the other hand, sustainable manufacturing remains a relatively new concept for the region’s manufacturing industries (Qureshi et al., 2020).

Conclusion

Major economies in Southeast Asia have demonstrated strong economic growth by achieving 5% or higher in recent years. However, there are inherent trade-offs between economic growth and environmental sustainability that need to be addressed. This can be achieved by developing policies that foster inclusive growth for people from different segments, diversify economies, enhance quality educational programme, strengthen accountability in resource production and consumption, and prioritise low-carbon initiatives by investing in green technologies and renewable energy. In principle, human development and access to quality education in the region play a pivotal role in shaping the region's long-term success in achieving economic prosperity with environmental protection and social equity.

Ting Surfia Miana