S'pore firms poised to benefit from Budget 2025 AI initiative: Observers

They could gain from lower barriers to entry and reduced investment costs

- Timothy Goh

Local companies that tap the Budget measure to support the adoption of tailored artificial intelligence (AI) solutions could gain from reduced investment costs and lower barriers to entry.

Industry observers said the new Enterprise Compute Initiative announced on Feb 18 will bolster Singapore's pipeline of tech enterprises, but increased adoption of AI solutions will hinge on whether companies are willing to embrace change.

They also noted that while the cost of tailored AI solutions will vary depending on the size and nature of the company, both large and smaller enterprises are expected to benefit from the initiative.

Mr Lyon Poh, head of corporate transformation and partner at professional services firm KPMG, said the Budget 2025 measure, which will receive up to $150 million in funding, signals the country's commitment to fostering an AI-ready business ecosystem.

"This initiative is poised to reduce barriers such as investment costs and technical expertise gaps, empowering enterprises to experiment with AI and integrate it into their workflows," he added.

Mr Poh also noted that achieving widespread AI adoption among companies in Singapore will require more than financial incentives, saying: "It necessitates a fundamental shift in mindset among business leaders. "Singapore's leadership must champion a future-forward approach to ensure businesses gain the confidence and capability to undertake AI-driven transformations at scale."

Mr Shashank Sharma, senior director of digital experience for South-east Asia and Korea at Adobe, said the initiative would be a "critical catalyst" for large enterprises looking to invest in innovation and remain competitive.

With AI deployment costs varying based on system complexity and scale, the Enterprise Compute Initiative could provide crucial support for companies with limited resources to accelerate AI adoption, he said.