CONSUMER advocacy group has urged Congress to adopt clear and robust data localization policies, adding that “policy gaps could leave Filipino consumers exposed as digital technology reshapes education, work, and business.”
“AI (artificial intelligence) has already become part of everyday life for Filipino consumers, especially among students and young professionals,” CitizenWatch Philippines lead convenor Orlando Oxales said in a statement.
“As adoption expands, policies must evolve alongside technology so consumers can safely and reliably benefit from AI,” he noted.
Recent data underscore how quickly AI has taken hold in the country. According to Statista and We Are Social–Meltwater, the Philippines ranks sixth globally in ChatGPT usage, with about 46 percent of internet users engaging with the platform, well above the global average of 26 percent. Meanwhile, the 2025 State of Higher Education report by education technology firm Instructure Holdings, Inc. found that 63 percent of Filipino students use generative AI tools such as ChatGPT for writing, translation, and research, the statement read.
This surge in use mirrors the rapid expansion of the local AI economy. Market estimates project the Philippine AI sector to grow from roughly USD 772 million in 2024 to as much as USD 30 billion by 2030. Separately, the Department of Trade and Industry has said AI adoption could contribute up to 12 percent of GDP growth, or about USD 92 billion. These trends point to a sharp rise in data generation, connectivity demand, and reliance on cloud-based digital infrastructure, it said.
CitizenWatch noted that AI use is becoming more customized, with platforms now allowing users and organizations to develop task-specific AI tools and agents. These systems require constant internet connectivity and large computing resources, which are typically hosted on cloud infrastructure—making the physical location of data storage a growing policy concern.
Oxales cited local technology companies such as Senti AI, Xurpas AI Lab, and Kital Philippines that are developing AI-powered solutions for customer service, analytics, and Filipino-language processing while sectors including fintech, logistics, media, and business process outsourcing are deploying AI for credit scoring, workflow automation, content moderation, and customer engagement, further increasing dependence on data centers and cloud services.
“As AI systems grow more complex, they require larger volumes of data and continuous data exchange,” Oxales said. “Where these systems are hosted directly affects performance, reliability, and user experience.”
On the other hand, Jimmy Go, president and chief executive of tech distributor VST ECS Philippines, said localized data storage can improve speed and reliability while also encouraging investments in power, cooling, and energy infrastructure.
“AI is now being embedded into critical industries such as Aboitiz Data Innovation that has deployed AI tools to optimize power plant performance and electricity management, while Globe Telecom has reported using AI to optimize energy use across its network generating electricity savings of 11.3 million kilowatt-hours in 2024, equivalent to around PHP 125 million,” Oxales said.
CitizenWatch warned that without a clear data localization framework, AI systems and data generated by Filipinos could be stored overseas, placing them beyond Philippine oversight and exposing users to risks from cyber incidents, service disruptions, or geopolitical instability.
The group noted that the local data center industry is already expanding, with telecommunications firms and foreign investors building new capacity. Market reports indicate operational data centers nationwide, with significant additional capacity expected in the coming years.
The group said it supports ongoing discussions among government agencies and industry stakeholders and reiterated its call for a balanced data localization policy that protects consumers while supporting innovation and investment.
“When policies are clear and forward-looking, consumers gain more reliable services, better protection, and greater confidence in the technologies they use every day.”
