Singapore on track to maximising benefits from AI

The venue for the opening ceremony filled quickly, leading to a spillover outside the entrance. Those outside could still follow SMS Tan's speech on displays mounted on either side of the entrance.

In his opening address at the 11th Tech Week Singapore 2025 earlier this month, Singapore's Senior Minister of State (SMS) Tan Kiat How noted that openness to technology had helped build a vibrant and innovative ecosystem in Singapore, which in turn keeps Singapore’s economy competitive and relevant to the world.

"We adopt the same approach to AI, a new technology sweeping the world with the potential to transform industry sectors, while also mindful that there are unintended consequences and downside risks," he shared.

"We are actively encouraging enterprises to adopt AI because we see its potential and want to harness its power of growth and productivity across sectors."

SMS Tan said Singapore has a three-pronged strategy that is focused on the regulations and guidelines about developing AI, encouraging the adoption of technology, especially AI, as well as talent and manpower development.

SMS Tan also touched on the recently-launched Singapore Digital Economy Report, noting that Singapore's digital economy accounts for more than 18.6% or S$128 B of GDP, and that two-thirds of the digital economy comes from the non-information and communication sectors.

"We see AI adoption picking up across industry sectors, amongst large firms as well as SMEs. This means it is not just about developing technology that has value, but the effective use of technology across different companies and sectors creates significant value," he said.

Specifically, AI adoption among small and medium sized enteprises (SMEs) tripled in 2024, from around 4% of all SMEs using AI in 2023 to 15% in 2024. Sixty percent of larger companies are using AI, compared to 40% a year ago. 

Singapore's AI strategy focuses on establishing regulations that support businesses in innovation, but at the same time including "sensible guardrails to mitigate the downside risk and manage the harm that may come with irresponsible and unethical use of technology like AI," SMS Tan said.

"One important aspect is our collaboration and partnership with industry players. We take this approach with humility that the government will not know all the answers, and we do not know the intricacies of the technology and the industry, which is innovating at a very fast pace. It is also in the interest of the industry to have sensible regulations to guide the development and use of technology," he added.

Some developments in line with the strategy include the Monetary Authority of Singapore (MAS), the financial regulator in Singapore, which worked with financial industry and relevant stakeholders to develop the Fairness, Ethics, Accountability and Transparency (FEAT) Principles for the responsible use of AI and data analytics in the financial sector.

Through MAS’s also developed Veritas Toolkit, which allows financial institutions to assess their AI solutions against the FEAT Principles. 

"Singapore is also prepared to make legislation when needed, when we are clear that there are risks to be managed and guardrails to be put in place," SMS Tan said.  

Another aspect of Singapore's strategy is an ecosystem where enterprises can build, test, and scale AI solutions. Sectoral AI Centres of Excellence (COEs) are part of this initiative, welcoming industry players with capabilities to encourage innovation across the entire industry sectors, SMS Tan said. 

The first such sectoral COE, launched last September, has already co-developed manufacturing solutions together with A*STAR, Singapore's institutes for higher learning, and industry partners. The solutions offer predictive maintenance and quality assurance powered by generative AI and machine learning. 

"Many of these problems are common ones facing the entire manufacturing sector. So, when you solve those problems, it helps to spread the benefits across the entire value chain, from large companies all the way to the suppliers," SMS Tan said.

The government is also working with companies to set up COEs, SMS Tan added, for manufacturing, financial services, and the legal sector. The COEs are established in partnership with industry players such as Google Cloud, AWS and Microsoft under the Enterprise Compute Initiative to share AI and innovation-related expertise and resources with Singapore-based companies. 

SMS Tan also spoke about launching SMEs Go Digital, which provides IT support for small and medium-sized enterprise (SMEs). "IMDA is working with the industry to curate pre-approved digital solutions with AI functionalities that can easily be used by the SMEs and we are doing so sector by sector. This is because the needs of a SME in a manufacturing sector can be very different from healthcare or hospitality sector," he said.

"We are inviting companies with good solutions to come on board and we bring both sides together to accelerate and jumpstart the AI adoption among our broad-based enterprises. We support the top-end companies who have ambition to grow their capabilities in AI, and many of them are MNCs with footprint across different parts of the region. This is how we are growing a vibrant ecosystem to support AI adoption across the board," he said. 

"All these can happen only with the right people, not just AI practitioners, engineers and innovators, but people who are deploying solutions in the companies." 

According to SMS Tan, Singapore's AI talent pool has grown by almost 25%. "We are on track to grow our pool of AI practitioners to 15,000 in Singapore," he said. 

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View highlights of the event at  https://www.facebook.com/media/set/?set=a.1437309921325709&type=3

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