KUALA LUMPUR (April 29): Artificial intelligence (AI) has the potential to increase global gross domestic product (GDP) by as much as 15 percentage points by 2035, according to PricewaterhouseCoopers (PwC), one of the "Big Four" accounting firms globally.

"This would effectively add one percentage point to annual growth rates — on par with the growth increment the world began enjoying with 19th-century industrialisation," PwC, which provides a wide array of services to businesses across industries, including auditing, consulting and tax services, said in a statement on Tuesday. 

However, in its report, "Value in Motion," which uses data-driven scenario analysis, PwC said the significant global economic benefits of AI are not guaranteed. Realising this potential depends not only on technological advancements but also on responsible deployment, robust governance, and the trust of both the public and organisations.

Lower levels of trust and cooperation could mute AI's incremental boost to the economy to 8%, or in a pessimistic scenario, to just 1%.

PwC Malaysia Managing Partner Soo Hoo Khoon Yean in the statement said the firm has updated its brand to better reflect its role in helping clients use expertise and technology to stay competitive. He reaffirmed PwC’s commitment to supporting businesses in navigating challenges like AI and climate change by building trust and long-term success in a fast-changing world.

PwC's analysis also indicates that pressure for businesses to reinvent themselves is at some of the highest levels seen in the last 25 years, across 17 out of 22 global sectors. In 2025 alone, US$7.1 trillion (RM30.99 trillion) in revenue is expected to shift between companies, even without considering global tariff hikes.

Its research also suggests that industries will "reconfigure" over the next 10 years to meet human needs in new ways, which will lead to the creation of new "domains" that transcend traditional sector boundaries.

As an example, it cited the rise of electric vehicles, which is bringing electricity providers, battery manufacturers, tech companies, and others into the mobility sector, allowing them to generate value alongside car manufacturers.

"As the structure of the economy transforms, value will increasingly come from organisations that can connect the dots across traditional industry boundaries. By focusing on evolving customer needs and using technology to dramatically change the way business operates, business leaders can unlock a step change in growth," said PwC global chairman Mohamed Kande.

But while AI is set to accelerate growth, the costs associated with physical climate threats will impose economic constraints, PwC said. Its economic modelling suggests that physical climate risks could result in a global economy nearly 7% smaller in 2035 than it would have been otherwise.

The increasing adoption of AI is also expected to drive higher energy consumption in data centres. However, PwC noted that modest use of AI to enhance energy efficiency could offset this increased energy consumption.

PwC estimates that if each additional percentage point of AI adoption led to innovations that reduced energy intensity by just 0.1%, the overall impact on energy use and emissions would be neutral.