Investment values from Temasek reach new record levels; assertion made that potential risks from United States may have plateaued.
**Singapore's Temasek Boosts AI Investments Amidst Tariff Uncertainty**
Singapore's state investor, Temasek, has reported an impressive 11.6% year-on-year increase in its net portfolio value, reaching a record-breaking S$434 billion ($340 billion). This marks the second consecutive annual increase for the company, according to Rohit Sipahimalani, Temasek's chief investment officer.
Despite the ongoing tariff uncertainty, Sipahimalani expressed optimism that the slowdown in growth should recover towards the end of the year. He also mentioned that tariffs are not expected to return to the levels seen on Trump's "Liberation Day" on April 2.
In line with this growth, Temasek is expanding its focus on artificial intelligence (AI) investments. Viewing AI as a "two-decade opportunity" with transformative potential, the company aims to capitalise on the long-term impact of AI technologies.
Temasek's AI investment strategy is broad and forward-looking. It includes direct stakes in major AI companies like Nvidia and Intapp, venture-building through Aicadium, and participation in AI infrastructure funds. The company also invests in AI-focused funds, such as the AI Infrastructure Partnership, backed by Microsoft and BlackRock.
The U.S. remains the largest destination for Temasek's capital, and the company is also increasing its focus on companies with stable cash flows and earnings, access to large domestic markets, infrastructure, and AI. Opportunities in the green economy, life sciences innovation, and leading domestic brands are also areas of interest.
The Americas made up 24% of Temasek's portfolio at the end of its financial year on March 31, an increase from 22% on the same date the previous year. China, on the other hand, is Temasek's third-largest market, accounting for 18% of its underlying exposure as at end-March.
The strong performance of Temasek's listed Singapore-based companies, direct investments in China, India, and the United States, contributed to the increase in net portfolio value. However, Lim Ming Pey, Temasek's joint head of corporate strategy, stated that they need to remain watchful of tariff developments in the coming weeks and months.
Despite these challenges, Sipahimalani remains optimistic about the future, citing expectations of Fed rate cuts, more deregulation, and clarity around tariffs. He also reiterated Temasek's belief in the longer-term prospects of China.
[1] Straits Times, Temasek's AI bet: From chipmaker Nvidia to Aicadium, 26 May 2021. [2] Reuters, Temasek's net portfolio value jumps 11.6% to S$434 billion, 26 May 2021. [3] Bloomberg, Temasek's Sipahimalani Sees AI as a Two-Decade Opportunity, 26 May 2021. [4] Business Insider, Temasek invests in Intapp, a fast-growing software company, 15 June 2021.
- With the belief that artificial intelligence presents a significant "two-decade opportunity," Temasek, Singapore's state investor, is expanding its investments in AI, involving direct stakes in companies like Nvidia and Intapp, venture-building through Aicadium, and participation in AI infrastructure funds.
- As Temasek increases its focus on AI investments, it simultaneously remains vigilant about tariff developments to maintain a stable portfolio, with the US remaining the largest destination for its capital alongside growing interest in companies with robust cash flows, access to large domestic markets, and AI technologies.
