Southeast Asian GDP is projected to grow at a CAGR of 4.7% from 2024 to 2029.

The Growth Trajectory

Southeast Asia’s combined GDP reached USD 3.98 trillion in 2024, according to Andaman Partners’ analysis of IMF data, and is projected to increase to USD 4.25 trillion in 2025 and USD 5.55 trillion by 2029. This implies a compound annual growth rate (CAGR) of approximately 4.7% from 2024 to 2029—a pace that has surpassed China’s economic expansion and is closely tracking India’s rapid growth, per the report. The region’s aggregate real GDP growth was 4.6% in 2024, with the Asian Development Bank (ADB) raising its 2024 Southeast Asia forecast from 4.5% to 4.7% in December 2024, citing stronger manufacturing exports—particularly electronics—and sustained public capital spending in larger economies. The ADB’s 2025 growth forecast for the region stands unchanged at 4.7%.

Growth Drivers: Engines and Divergence

Growth across the region’s 11 economies remains uneven but is concentrated in three frontier markets. In 2024, Vietnam posted the highest real GDP growth at 6.1%, followed by the Philippines at 5.8%, and Indonesia and Cambodia each at 5.0%, based on Andaman Partners’ compilation of national data. Malaysia (4.8%) and Laos (4.1%) exceeded 4%, while Thailand (2.8%), Singapore (2.6%), Brunei (2.4%), and Myanmar (1.0%) grew more modestly.

Looking forward, Vietnam, Indonesia, and the Philippines are projected to sustain real GDP growth above 6% through 2029. Vietnam has maintained a long-run growth trajectory of more than 7% annualised GDP growth from 2014 to 2024. Indonesia, the region’s largest economy with a GDP of USD 1.40 trillion, benefits from abundant natural resources, a growing digital economy, and infrastructure investment. The Philippines, at USD 470 billion in GDP in 2024, is leveraging a pro-growth administration prioritising infrastructure and renewable energy, and continues to reap demographic dividends absent in Singapore and Thailand.

The Angsana Council, Bain & Company, and DBS Bank’s Navigating High Winds report, covering the six largest economies (SEA-6: Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Vietnam), projects their combined GDP to grow at an average annual rate of 5.1% from 2024 to 2034, with Vietnam and the Philippines each exceeding 6% and Indonesia close behind at 5.7%.

Real GDP Growth (%) (%)Source: Orionmano Industries

Trade, Manufacturing, and Investment Flows

Total trade in the region reached USD 3.8 trillion in 2024, the Andaman Partners report notes. Vietnam has emerged as one of the world’s fastest-growing exporters, with export values increasing 400% from 2010 to 2023. The region’s manufacturing sector contributed USD 673 billion to GDP. The ADB’s December 2024 outlook specifically cited stronger manufacturing exports, particularly from the electronics industry, and public capital spending as key upward drivers of its revised 2024 forecast.

Foreign direct investment (FDI) remains concentrated. Singapore captured the largest share among the SEA-6 economies at USD 159.7 billion in 2023, representing nearly 80% of total FDI for the group, per the Angsana Council report. However, investment into Vietnam, Indonesia, and the Philippines is rising, supporting their manufacturing-led growth models and supply-chain diversification strategies that multinational corporations are pursuing.

Structural Risks and Headwinds

Despite the bullish trajectory, the ADB and other sources identify several downside risks. Geopolitical tensions and trade fragmentation—particularly policy changes under the incoming Trump administration in the United States—could impact the region’s export-dependent economies. Severe weather events, including Typhoon Yagi and Tropical Storm Trami in 2024, pose risks to agriculture and infrastructure. The ADB noted that poorer ASEAN members—Cambodia, Laos, and Myanmar—appear to have settled at a lower trend growth rate post-pandemic, even as Indonesia, Malaysia, Thailand, and the Philippines returned to pre-2019 growth levels. Singapore and Thailand face demographic headwinds with aging populations, while Indonesia must improve manufacturing value-added and maintain an open, competitive economy to exceed its 5.7% potential growth forecast.

Comparative Benchmarks

Southeast Asia’s combined 2024 GDP of USD 3.98 trillion sits between that of Latin America & the Caribbean (USD 6.73 trillion for 33 countries) and Sub-Saharan Africa (USD 1.89 trillion for 45 countries), per the Andaman Partners report. The region’s growth outperformance relative to China marks a structural shift, as multinational corporations increasingly look to diversify supply chains and tap into the region’s growing consumer markets and expanding middle class. With aggregate GDP projected at USD 5.55 trillion by 2029, Southeast Asia’s economic weight in global terms will continue to rise, provided the region navigates external headwinds and maintains its reform momentum.