Southeast Asians classified as poor and low-income shared a high 44.7% of the region’s population, or 306 million of a total of 686 million. Social inequalities are similarly endemic in Southeast Asia, as reflected in the distribution of incomes across seven categories—poor, low income, lower middle, middle, upper middle, upper income and rich (see Table 1). 

For the region as a whole, of a population of 686 million in 2025, 141 million (20.6%) were classified as poor (with less than US$100 a month), and those with low incomes ($100–$250 a month) tallied 165 million (24.1%). 

Unequal income distribution

Those in the lower middle income level totaled 131 million (19.1%); the middle income earners 117 million (17%), and the upper middle earners 73 million (10.6%). Thus, the middle income earners comprised 46.7% of the SEAsian population, or 321 million. Lastly, those in the upper income category with monthly incomes ranging from $2,500 to $5,000 totaled 39 million (5.86%) and the rich (above $5,000 monthly incomes) reached 19 million (2.68%). Thus, the upper income and rich Southeast Asians totaled a low 58 million (8.5%).

These calculations were based on data compiled from the World Bank, the Asian Development Bank, the World Inequality Database, and the National Statistics Offices of Southeast Asian governments. 

The inequalities, however, become more pronounced across the countries in the region. In the nine countries with the highest inequalities—the Philippines, Indonesia, Vietnam, Thailand, Malaysia, Cambodia, Laos, Myanmar, and Timor Leste—the difference between rich and upper income earners on one hand and the poor and low income earners on the other becomes more pronounced. Those in the poor and low income levels comprise 56% of the total population, the rich and upper income earners a mere 3.55%. 

The total figures from Singapore and Brunei skew the overall inequality picture where the poor and lower income earners comprise a mere 5% of the population and those in the rich and upper income category 9%. 

Another measure of inequality is the Gini Coefficient Index where an index rating of 40 is considered a danger zone for inequality (see Table 2). Note: The Gini index (or Gini coefficient) ranges from 0 (or 0%) to 100 (or 100%), with 0 representing perfect equality and 100 representing perfect inequality. The latest figures show that Singapore (45.9), Malaysia (40.7), and the Philippines (40.7) have crossed the inequality borderline, with Laos (38.8) being dangerously close to it. It is ironic, however, that Singapore, the richest country in Southeast Asia, also has the highest level of inequality. 

The Pikkety Formula

The French economist Thomas Pikkety developed a creative and historical-based method for measuring levels of inequality. He tracked the 200-year relationship in capitalist countries between average annual rate of return to capital (r) and the rate of economic growth (g) and discovered that “r” has always been greater than “g,” as expressed in the formula “r > g.” Wealth in the hands of individuals accumulates unequally over time, far exceeding society’s economic output. 

In other words, the rate of economic growth has consistently lagged behind the growth in capitalist profits. This results in the unequal distribution of wealth with the difference growing over time. 

Adopting Pikkety’s formula for Southeast Asia and tracking just the 11-year period from 2013 to 2023, while the average rate of return to capital ranged from 10.1% to 15%, the average rate of economic growth was merely in the range of 4.7% to 3.2%, or less than one-third of the former (see Table 3). The data also show that while the average rate of return to capital in Southeast Asia has increased from 10.1% to 15% (a 49% rise), the average rate of economic growth has declined from 4.7% to 3.2% (a 32% drop). 

For Pikkety, the “r > g” formulation reveals a major and inherent source of inequality in the world today and one which is endemic to capitalist societies which is exacerbated over time. 

Where the rich get their wealth

An important question is: Where do the income and wealth of Southeast Asia’s rich and upper income earners come from? The answers can mainly be inferred from Pikkety (2017), Studwell (2007), Junaid (2025a), and Lee (2025). Many of the region’s richest families are dynastic in origin, particularly those involved in real estate, banking, retail and manufacturing. Prominent examples of these are the Salim Group (Indonesia), the CP Group (Thailand), the SM Group (Philippines) and the Kuok Group (Malaysia). Many are also involved in extractive and commodities industries like oil, gas, palm oil, timber, and mining, such as Sri Prakash Lohia (Indonesia), the Kuok brothers (Malaysia), and Brunei’s royal family. 

Even more lucrative businesses involve real estate and property development, with the rise of luxury condos, commercial hubs, and industrial parks. Prominent tycoons are the Kwek Leng Beng family (Singapore), the Villar family (Philippines) and the Vingroup (Vietnam). Manufacturing and export-oriented industries are also favored, such as textiles, electronics, and automotive sectors in Vietnam and Thailand. The newest additions are technology and start-ups such as e-commerce, fintech, and digital services, such as Sea Limited and Grab (in Singapore) and the GoTo group (Indonesia). 

Political connections and monopolies have long been crucial and highly determinant factors in wealth formation and growth. These are done through government contracts, licenses, and regulated industries. Political families have also leveraged themselves into big business conglomerates such as the Lee family’s continuing control of government-linked Temasek Holdings of Singapore, the strong ties of the Mahathir family with Malaysia’s business elite, and the continuing hold of the Suharto family members on business interests in Indonesia. 

Finally, upper income earners consist of corporate executives of multinational firms and regional offices, finance professionals dealing with hedge funds and private equity, and expatriates in oil and gas, law, and consulting firms.

Poverty rates

Poverty rates reflect the social disparities in Southeast Asian countries (see Table 4). Poverty thresholds vary for lower income countries (LIC), lower middle income countries (LMIC), and upper middle income countries (UMIC). Note: According to the World Bank, for LIC), the daily poverty threshold is $3 a day; for LMIC, $4.20 a day; and for UMIC, $8.30 a day. 

Using the World Bank poverty thresholds, 9 of the 11 Southeast Asian countries register high poverty rates. The highest rates register for Cambodia, Myanmar, Timor Leste and Laos—ranging from 25% to 60% poverty. Malaysia, Thailand, Indonesia and the Philippines are in the 12% to 30% poverty levels. Vietnam straddles the 10–12% level, and only Singapore and Brunei have low poverty rates. 

High poverty rates, on top of persistent social inequalities in Southeast Asia, uncover the non-inclusive and elite-centered character of the region’s high economic growth rates and represent serious challenges for Southeast Asian states to confront and address meaningfully.

This piece is extracted and revised from Eduardo C. Tadem. 2025. “Introduction: As Southeast Asia flounders, the search for alternatives becomes imperative” in soon to be published Volume 3 of Alternative Practices Across Southeast Asia. Program on Alternative Development, UP Center for Integrative and Development Studies (AltDev UPCIDS).