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“In past years, at the Shangri-la Dialogue, my sense was that they were talking past each other, and that talking was at various decibel levels,” he said, referring to the defence forum that took place over the weekend that he attended.<\/span><\/p>\n This year, the decibel level has come down and both sides mentioned words such as “constructive”, “strategic” and “stable” to describe their relationship.<\/span><\/p>\n “This time there was at least a convergence point around these four words, of what that relationship between the two countries should be, and I thought that was something positive,” he said.<\/span><\/p>\n Asked about the\u00a0<\/strong>Middle East conflict, Mr Teo said the second-order effects\u00a0<\/span>of the war will likely last for a long time<\/span>, giving the example of how food prices will rise because of the disruption to the fertiliser market.<\/p>\n Despite this, Temasek has a “significant” presence\u00a0<\/span>in the Middle East and sees continued prospects there, he said.<\/span><\/p>\n Mr Teo said\u00a0the Middle East has a lot of resources, high ambitions, and “increasingly high ability to see through these ambitions”.<\/span><\/p>\n Temasek\u2019s portfolio companies and direct investments can contribute to and benefit from\u00a0<\/span>such ambitions, he added. “We are looking carefully at what we can do there and we are prepared to step in when the opportunities arise.”<\/span><\/p>\n Companies in Temasek’s portfolio such as PSA, SATS and ST Engineering are already involved in activities in the Middle East.\u00a0<\/span><\/p>\n Temasek has also partnered with BlackRock’s Global Infrastructure Partners, Abu Dhabi’s sovereign investment platform and the Abu Dhabi National Oil Company to invest in the Gulf region and Central Asia.<\/span><\/p>\n Mr Teo said Temasek is “actively looking” at opening an office in the Middle East and finding the right time to do so because there are opportunities for investment in the region.\u00a0He did not elaborate on where the office might be located in the region.<\/span><\/p>\n Temasek currently has 13 offices in nine countries.<\/span><\/p>\n On the topic of technology investments, Mr Teo said Temasek looks for companies that are going to be strong and creative in their applications of artificial intelligence.<\/span><\/p>\n “They are able to create value, and they will disrupt others,” he said.<\/span><\/p>\n Temasek has invested in Claude-developer Anthropic and AI-chipmaker Nvidia<\/span>, among other AI businesses.<\/p>\n Besides the companies that are developing large language models, there is a “rather large stack” that investors can look at, which may not get caught up in geopolitical arguments, he said.<\/span><\/p>\n The technology\u00a0will be a “major game changer” that will create an entirely new sector, and there will be AI-native companies that “come out of nowhere” with new lines of businesses and services, said Mr Teo.<\/span><\/p>\n He said investments into tech seem to focus on a “fairly narrow” segment of the AI field, and that is drawing resources away from other parts of the market.<\/span><\/p>\n “It\u2019s sort of, in a way, almost distorting the market,” he said.<\/span><\/p>\n This is why Temasek looks for “long-term sustainable absolute returns” in AI, said Mr Teo.\u00a0<\/span><\/p>\n “That\u2019s our key, so we try and look through some of these, we participate, we look through them and look for long-term sustainable returns.”<\/span><\/p>\n Mr Teo also fielded questions on the recent restructuring at Temasek and its role in the Singapore stock market.\u00a0<\/span><\/p>\n He previously <\/span>served on GIC\u2019s board for 14 years,<\/span> including as chairman of its international advisory board.<\/span><\/p>\n GIC invests Singapore\u2019s reserves and primarily does so outside the country, whereas Temasek does not receive regular injections from the government. Temasek invests in Singapore and largely in the equity space.<\/span><\/p>\n On <\/span>Temasek\u2019s restructuring,<\/span> he said it has helped to give the company greater focus and attention to each of the three segments of its portfolio.<\/span><\/p>\n In April, the company set up three entities\u00a0<\/span>to manage different parts of its portfolio: Temasek Global Investments, Temasek Singapore and Temasek Partnership Solutions.<\/span><\/p>\n Mr Teo said each segment requires a different way of working, and provides opportunities for staff to develop their leadership skills.<\/span><\/p>\n “We have decentralised some of the decision-making on investments to these groups, so they will have greater ability to make decisions within the groups, and also more responsiveness and flexibility,” he said.<\/span><\/p>\nWHAT TEMASEK LOOKS FOR IN AI<\/h2>\n
TEMASEK\u2019S ROLE IN SINGAPORE<\/h2>\n