Budget 2024: More than S$11 billion to be injected into R&D, AI, finance, clean energy

• RIE2025 plan to receive additional S$3 billion in funding, bringing total to S$28 billion
• More than S$1 billion to be invested under the National AI Strategy 2.0
• S$2 billion top-up to Financial Sector Development Fund; S$5 billion initial investment into Future Energy Fund

FINANCE Minister Lawrence Wong announced investments of more than S$11 billion into national research and development (R&D) efforts, as well as the artificial intelligence (AI), finance and clean energy sectors, in his Budget speech on Friday (Feb 16).

The government will inject S$3 billion into the Research, Innovation and Enterprise 2025 (RIE2025) plan for important segments such as advanced manufacturing, sustainability, the digital economy and healthcare.

This brings the total funding for the plan to S$28 billion.

RIE2025 was launched in 2020 with three strategic focus areas:

• Investing in more national initiatives to drive economic growth and industry transformation, as well as digitalisation
• Growing Singapore’s research talent pool and increasing research funding
• Helping more enterprises commercialise their technologies and improve innovation

Next, the government will invest more than S$1 billion over the next five years in developing AI compute infrastructure, talent and the industry.

This is in support of the National AI Strategy 2.0, which was unveiled in December last year and is designed to support Singapore’s aim of becoming a global AI leader.

Part of the investment will go towards helping the country gain access to advanced chips essential for AI development and deployment.

The government will also work with large AI companies to set up “centres of excellence” here to drive industry collaboration and innovation.

There will be a top-up of S$2 billion to the Financial Sector Development Fund (FSDF) to give the Monetary Authority of Singapore more resources to grow the financial services sector.

The additional funds will be deployed towards core areas such as banking and capital markets, as well as new areas like green and transition finance, and fintech.

FSDF provides grants to companies and individuals in the financial services sector, covering three broad areas:

• Key business areas such as fixed income, investment funds and green finance
• Innovation and technology 
• Skills and career development 

The FSDF had net assets of S$1.08 billion as at 2022/2023.

In the clean energy sector, the government will invest an initial S$5 billion – through a new initiative named the Future Energy Fund – to build critical infrastructure and improve energy security.

Wong noted that investments into clean energy are costly, citing examples such as the need for new infrastructure for energy generation, storage and delivery.

“They cannot be done by the private sector alone, and will likely need some catalytic funding from the government,” he said.