Asia remains at the center of the transformational artificial intelligence (AI) investment story, as it expands from a narrow focus on chips and data centers to a much larger ecosystem spanning memory, compute, power infrastructure, grid upgrades, industrial systems and advanced manufacturing, MetLife Investment Manager and PineBridge Investments said on Thursday.
The duo said in a report that AI opportunities in the region are broadening beyond upstream semiconductor infrastructure.
Although geopolitical risks and commodity price volatility could create periods of turbulence in markets, they believe Asia remains well positioned to benefit from the structural growth themes of AI, digital infrastructure, energy transition, industrial modernization and domestic reform.
According to the report, Asia stands at the center of this transformation, firmly embedded in the global AI supply chain.
The rapid growth in AI token consumption has already accelerated capital expenditure (CapEx) across the technology complex, creating demand-supply imbalances across hardware supply chains.
As AI adoption scales, the report highlighted the opportunity set is becoming increasingly diverse. A notable development is the emergence of agentic AI.
Unlike earlier AI applications that relied heavily on compute-intensive inference workloads, it opined that agentic AI introduces more complex workflows involving autonomous agents, tool utilization and decision-making processes—activities that require greater processing power and substantially larger memory capacity.
This broader compute demand has important implications across the supply chain. Greater compute and memory requirements are expected to support demand for advanced substrates, packaging technologies and semiconductor materials, extending the growth runway for many Asian technology companies.
“The result is an investment landscape that no longer depends solely on a handful of AI leaders,
“Instead, opportunities are emerging across a much wider swath of technology enablers,” it added.
That said, it opined that investors should expect continued volatility and divergence within the sector.
Key drivers include the uncertainty around the sustainability of AI-related CapEx.
As AI models become larger and more compute-intensive, the report said data centers are consuming significantly more electricity, driving demand for power generation and related infrastructure.
This is creating a powerful investment cycle that extends well beyond technology hardware.
“Asia is entering a multi-trillion-dollar energy CapEx cycle over the coming years,
“The implications are far-reaching. Grid upgrades, transmission infrastructure, power equipment, battery storage and renewable
energy development are becoming increasingly central to the AI value chain,” it said.
It also said governments and utilities across the region are investing heavily to improve energy resilience and accommodate rising electricity demand.
This dynamic is creating attractive opportunities across power equipment manufacturers, electrical component suppliers and grid specialists, while also supporting industrial companies poised to benefit from infrastructure modernization and rising data center power demand.
If AI investment continues to accelerate through increasingly sophisticated models and larger-scale data centers, the report noted that demand is likely to follow.
Asian manufacturers are particularly well positioned to capture significant value given their competitive advantages in production, scale and cost efficiency, it added.
Among regional markets, it noted Taiwan and South Korea appear best placed to capitalize on the structural AI opportunity.
According to the report, Taiwan occupies a uniquely critical position at the center of global semiconductor supply chains.
The market produces more than 60 percent of global semiconductors and more than 90 percnet of leading-edge chips.
Structural demand for advanced computing, high-performance chips and AI-related technologies continues to support earnings growth across many industry leaders in Taiwan, it added.
South Korea also remains well positioned, particularly within memory semiconductors.
It accounts for approximately 60 percent of the global memory semiconductor market, including a 70 percent share of the global dynamic random-access memory (DRAM) market, said the report.
“We maintain strong conviction in the earnings outlook for leading memory manufacturers, supported by favorable industry dynamics and growing AI-driven demand,
“Importantly, South Korea’s investment case is increasingly supported by domestic reforms,” said the report.
It is noted that the government’s Value-Up program, introduced in 2024, established a framework aimed at improving corporate governance and shareholder returns.
Subsequent policy measures and ongoing implementation efforts through 2025 and 2026 have sought to further strengthen shareholder rights, reduce the influence of controlling shareholders and encourage higher dividend distributions.