SG Budget 2025: $112m initiative to broaden AI access

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On February 18, Singapore Finance Minister Lawrence Wong announced that up to S$150 million (US$111.8 million) will be set aside for the new Enterprise Compute Initiative. The program will enable eligible enterprises to partner with major cloud service providers and access AI tools and computing power.

Through the partnerships, the enterprises will also be able to access consultancy services.

In his Budget 2025 speech delivered in Parliament, Wong, who is also the country’s prime minister, said the initiative will help companies “leverage AI more effectively in their transformation journey.”

“Beyond a certain stage, enterprises will need AI solutions, which are tailored to their needs and integrated into their business processes and systems,” he said.

The government will also help firms scale up and compete on the global stage by extending support schemes for internationalization and mergers and acquisitions (M&A).

To aid local SMEs expanding overseas, the Market Readiness Assistance Grant – which helps defray the costs of overseas market promotion, business development, and market setup – will be extended to March 31, 2026.

Meanwhile, the Double Tax Deduction for Internationalization scheme will be extended to December 31, 2030. The scheme allows businesses to claim a tax deduction of 200% on qualifying market expansion and investment development.

The Enterprise Financing Scheme (EFS), which enables Singapore enterprises to access financing more readily across all growth stages, will be enhanced in two ways. First, the maximum loan quantum for the scheme’s trade loan will be permanently raised to about US$7.5 million, up from US$3.7 million.

Second, the M&A loan under the EFS will also be enhanced to support targeted asset acquisitions from April 1 to March 31, 2030.

Finally, the Mergers & Acquisitions Scheme will be extended to December 31, 2030 to continue helping companies grow through M&A. This initiative allows firms that make a qualifying acquisition of ordinary shares of another company to claim certain tax benefits, subject to conditions.

Wong noted that Singapore already has a “good pipeline of such promising enterprises.” He cited semiconductor testing solutions provider AEM Holdings as an example, as it has a global footprint and because its products serve a “critical role in the chip production process.”

In addition, the Singapore Economic Development Board plans to launch a Global Founder Program in 2025, the prime minister said.

The Economic Development Board, as Singapore’s investment promotion agency, has developed close links with multinational firms and established entrepreneurs that have started ventures, he added. The program plans to encourage global founders to anchor and grow more new ventures in Singapore.