How Singapore’s SMBs and AI sustain a robust digital economy

The digital economic system has maintained a 17.7% share of GDP in Singapore, the place small and midsize companies (SMBs) in addition to synthetic intelligence (AI) are predicted to play key roles in fueling progress.

The nation’s digital economic system contributed SG$113 billion ($85.31 billion) to final yr’s GDP, accounting for SG$1 of each SG$6, in response to the most recent stats launched by trade regulator Infocomm Media Improvement Authority (IMDA). 

Clocking a compound annual progress charge of 11.2% between 2018 and 2023, Singapore’s digital economic system nearly doubled the nominal GDP progress charge of 5.8% for its whole economic system, IMDA stated. Its digital economic system contains the knowledge and communications sector, which contributed about one-third of the pie, whereas non-information and communications sectors accounted for the remaining two-thirds. 

Some 94.6% of SMBs have adopted digital applied sciences in a couple of of six key areas, reminiscent of AI, cybersecurity, cloud, and information analytics. People who did so beneath the federal government’s Productiveness Options Grant stated they noticed value financial savings of fifty% on common between 2018 and 2023, IMDA famous. 

The federal government company added that SMBs within the nation have entry to 400 digital options pre-approved for deployment through its CTO-as-a-service platform, which have been tapped by 145,000 customers so far. 

SMBs can also undertake AI-enabled purposes on the platform, the place 20% of pre-approved options are AI-enabled. IMDA stated it plans to extend this determine and encourage a further 15,000 SMBs to undertake AI options over the following two years. 

These trying to take action can also trial generative AI (Gen AI) in a sandbox surroundings that caters particularly to SMBs. First launched in February 2024, the second iteration of the sandbox is slated for launch in December with a curated checklist of 15 Gen AI options throughout numerous market segments. These embrace Gen AI for expertise acquisition, generative internet design, and digital assistants for buyer engagement brokers. 

IMDA stated greater than 300 SMBs are anticipated to leverage the sandbox, with eligible candidates receiving as much as 50% funding assist to trial one of many Gen AI purposes for 3 months. Greater than 150 had participated within the first run of the sandbox function, which led to Could, and 80% of those companies are working the Gen AI purposes after the tip of the three months. 

AI adoption charge amongst SMBs clocked at 4.2% final yr, up from 3.5% in 2018. 

IMDA added that bigger enterprises in Singapore even have turned to AI, with 44% rolling out such purposes final yr, up from 16.7% in 2018. 

The expertise sector is rising at greater than twice the speed of the remainder of the economic system, at barely greater than 11%, which underscores the necessity for all corporations, particularly SMBs, to embrace the alternatives of digital as an enabler and for progress, stated IMDA chief government Lew Chuen Hong.

“There’ll at all times be international financial uncertainties pushed by many macro tendencies that generally are out of our management, however expertise as a structural driver will stay the case for the long term,” Lew stated. “We’ll proceed to see important progress so far as digital and the digital economic system is anxious.”

“AI has important potential in the long term and in any tech cycle. We’ll see some exuberance firstly, however on the similar time, AI has demonstrated its influence by way of reworking fundamentals in all sectors,” he stated. “The important thing right here is how will we, as a really small nation, put money into the proper areas to permit the businesses to maximise the benefits of this expertise.”