Remarks by Mrs. Josephine Teo, Minister for Digital Development and Information at GZERO Summit Asia

Moderator Gerald Butts, Chairman and Senior Advisor, Eurasia Group: Minister, how did you accomplish what you've accomplished here in Singapore? How did Singapore become a magnet for consequential capital firms, in particular in AI? What had happened? Tell us the story.

Minister Josephine Teo: What is it in particular that has impressed you, Gerald? I'm curious.

Moderator: Well, these are companies that have a lot of options on their dance card, right? But somehow, you've managed to create one of the most consequential nodes of development, capital employment in one of the two or three, maybe the topmost significant area of economic development in the world.

Minister: Well, Gerald, I think when it comes to AI, you could be referring to companies like Google DeepMind deciding to set up shop here or Open AI, deploying their army of forward-deployed engineers in Singapore. We have no illusions of grandeur. We don't start off thinking that we are a natural place for people to want to come to. If you think about our airport, for example, in terms of location, Changi is not the most attractive place to be. So we have to build something of value, make ourselves relevant, and that has been a very consistent approach across many decades of economic development.

When it comes to AI, we are very realistic. If you look at the front runners, primarily the U.S. and China, they are far ahead. I come across various rankings. Whatever the measure may be, the picture is broadly similar. You have the U.S. and China, depending on who puts out the ranking, followed by a cascading group of countries. Singapore would probably be amongst those ahead in this second group. But what I always remind my colleagues is this: If you look at the distance between Singapore and those placed just behind us, it's very small. But if you look at our distance from the U.S. and China, it's very large . So we are very realistic, and we have to look at what Singapore is able to offer and why AI talent and AI companies would choose to be part of our ecosystem.

So ambition becomes very important. You need to have an idea of what you want to do with AI. It is one thing to say that you have a strategy. It is well and good to talk about adoption amongst micro, small and medium enterprises, but these on their own are not going to be big enough. So we persuaded our Prime Minister to chair the National AI Council, and asked him to take the lead on this very important agenda because we felt that there are some areas that would be particularly attractive to top AI talent and companies.

Take for example, the fact that our aviation sector is going through a sea change. In the next decade or so, we will be adding something like 50 million in passenger-handling capacity. When you delve deep into how an air hub operates, it's very complex. The operations require a lot of math, a lot of computation. If you think about our port handling so many containers, arriving at different times from different vessels, having to be stacked in the yard, and subsequently having to be put onto a whole range of vessels - those are also computationally very complex.

So we said that even in connectivity alone, there are interesting problems for people to solve. Problems that, if solved in Singapore, can be scaled elsewhere in the world. In other words, the market can't be just Singapore. Singapore is where you stage the initial solution, and then work through whether it is implementable in Singapore. If the proof of concept turns out to be valid, then you can potentially bring the whole experience elsewhere.

So we decided that we would identify a few key sectors for our National AI Missions. Connectivity is one of them. Advanced manufacturing is another very interesting part of it. If you think about it, Singapore is not a very low-cost location to operate in, and yet manufacturing still contributes close to 20% of our GDP, with hundreds of thousands of workers. But what goes into manufacturing is completely different. It involves not the same kind of activities, not the same kind of skill sets, and not the same set of companies.

So, what we hope to do is to be a credible and trusted partner, meaning that we have problems that we are interested in getting solved. We know that solving them for Singapore alone is not the big prize, but solving them allows you to tackle similar problems elsewhere in the world. If Singapore can help to be part of your greater success, that's how we can remain relevant.

Moderator: That's fantastic. The speaking of problems developing in other parts of the world, are you concerned about how rapidly the capital is being deployed in the sector and the scale of it in the two, largely in the United States, of course, but also in China. I hesitate to use the B word to describe the part of the market cycle where it is now is "bubbling". But are you worried about where we find ourselves?

Minister: It's not for us to speculate whether this bubble is going to burst, when it might burst. The writing is on the wall - AI is already a very big part of our economy. It will only grow. It's here to stay. So whether you look at it three years down the road, five years down the road, or a decade down the road, you're going to have to master this technology. There's no question about it. But mastering this technology is easier said than done. It has to be done at the level of the workforce. People must be able to use this technology for purposeful activities, not just for planning their travel. That's useful, but how do you apply it at work?

For enterprises, the landscape is going to change very significantly. Today there are maybe 70 AI Centres of Excellence in Singapore, and I engage with them. If you ask about the kind of work they are doing today, compared to just a year ago, it's significantly different. A year ago, not many of them were experimenting with agents. Today, almost every single one of them are using agents in some way, and their perspective is very interesting. They know what the agents can do now. They are also very mindful of what the agents should not do.

So that brings in another dimension, which is how you create an environment where AI deployment is responsible and trustworthy. That adds another dimension that Singapore would like to remain strong in. How do you maintain a trusted environment for technology and innovation? It doesn't mean that we jump straight to regulation, but it does mean keeping an eye on the risks and helping to shepherd people towards into good practices. Whether it is to dealing with data in a responsible way, or designing agent systems in a trustworthy way, these are the kinds of areas where we invest tremendous effort, together our partners in the industry. These are not always the kinds of efforts that will land us on the on the front page. They may not make the headlines, but they are the things that ultimately matter.

Moderator: So one of those risks that must preoccupy your time, and I'm mindful of what you said in response to the last question that I asked, that you have to be careful trying to manage things that are really outside of your control, and focusing on the things that you can control is the secrets of success in government and in life. I think the United States and China, the relationship is, to be diplomatic about it, taking a very different form, and AI and technology are taking on a very different shape than it looked like it would 20 years ago. How do you think about that when you're having a risk mitigation conversation in Singapore?

Minister: It is what it is. Major power contestation is real. It impacts all of us. We are not going to be able to avoid it. The way we think about it is to focus on a few key things. For example, we want to be a credible and trusted partner to technology providers. If there is a set of terms of use for the technology, and if we agree to it, you can count on us adhering to it and doing our part to uphold the agreement.

Second, it also means that we stay connected to diverse sources of technology. Our strategy cannot be to rely on access to any singular platform or ecosystem. It has to be diversity by design, and this could apply to any aspect of the AI technology stack. Whether you're talking about models, whether you're talking about below that the infrastructure that supports it, whether it be at the cloud level, orthe data centre level, and this also applies to the kinds of applications that will be built on top of these models.

You'd find Singapore to be a very welcoming place for AI organisations - anyone with AI capabilities originating from anywhere in the world - as long as they operate in Singapore in a law-abiding manner and not use Singapore to flout other countries' laws, they are very welcome to be here.

Complementing this, we build up our own capabilities wherever possible. We may not build the most advanced model, but we can build a model which, for example, is able to cope very well with Southeast Asian markets. So that's one way in which we can partner with other model developers. Put the two together and it's more valuable. We are not necessarily going to go head-to-head in terms of accomplishment, but finding relevance to interoperability.

Moderator: That's a good segue into my next question, which is that Singapore is taking on the chair of ASEAN in 2027: What are your goals?

Minister: It's just one year, so we have to build on what has been done before, and then also think of it as scaffolding for the next ASEAN Chair to continue.

The Philippines, which is the Chair this year, has started a whole movement to promote AI adoption amongst micro, small and medium enterprises. We think that is a good effort and we will continue it. Our Thai colleagues take on the chairmanship after our year of chairmanship. Very recently, I was in Bangkok as part of the ministerial delegation. We discussed the need for common standards. Not so long ago, the Thais decided that they would put a stop to some of the data centres from being developed, and part of the concern is around energy. As it turns out, just two days ago, we tabled a new bill that would introduce new standards for energy efficiency in our data centres.

So there is scope for us to cooperate. We are very willing to share with them how we are thinking about the problem. We are in a tropical climate, so data centres have to operate at low temperatures, and even operating one degree higher would be better. Those kinds of things are practical ways in which we can cooperate.

I would say that apart from promoting AI adoption,deeper engagement on interoperable standards that could cut across the whole of ASEAN, would also be a meaningful area of cooperation.

I would just add one more thing: people who are interested in building AI tools for their own organisations are very aware of the difficulties because without quality data, you're not going to be able to get the AI to work effectively for you. We as a region already have some good foundations in terms of cross-border data flows. We think thishas to be taken further.

Moderator: It strikes me that you've chosen to focus in very practical areas of employment. You talked a lot about advanced manufacturing and connectivity. Can you talk a little bit about healthcare? Why did you choose it, and what makes you excited about the applications in the healthcare field?

Minister: Tremendous, because Singaporeans is already one of the longest living people in the world. But living long doesn't always equate to living well. The holy grail is how do you improve healthcare - it's definitely not sick care, and how do you introduce treatments as well as interventions that are not just in place but just in time and just right.

The whole concept of personalised, predictive healthcare becomes very exciting to us. We're a small enough population. We have good data, and they are not only healthcare-related data. You could triage, and you could link them with other kinds of data that you are able to access on a person, and if you set up the system right, it potentially helps to improve the quality of life of the citizens.

Now, does it have to stop in Singapore? The answer is no. If we can improve the life and healthcare of Singapore citizens, there is no reason why these innovations cannot be extended elsewhere in the world. So we're thinking of our interest in the use of AI for healthcare in this way.

Moderator: Yeah, I mean, I think look at the narrative on AI in North America, because it's not just the United States, Canada has become so dark so quickly that it's refreshing to hear your government that's leaning into the possibilities. So maybe I'll close with a note of optimism: Where do you see AI in 10 years?

Minister: Let me say this: it's here to stay, and the sooner we learn to deal with its risks, the sooner we come to grips with its downsides. I think we can create more room for its upsides to truly materialise for our people, and of course for all we can do.