AI Risks and Bubble Fears Put Investors on Alert at Singapore Forums

Concerns over the artificial intelligence (AI) boom are broadening beyond high valuations, with investors and policymakers in Singapore warning about financial losses, autonomous systems and potential misuse of the technology.

The concerns emerged at the Milken Institute Asia Summit and the Forbes Global CEO Conference on Wednesday. Speakers discussed the risks of AI systems escaping human control, the use of AI in developing biological weapons and the possibility that massive investments may fail to generate expected returns.

Singapore Foreign Minister Vivian Balakrishnan said the risk of losing control over autonomous AI systems is real.

He also warned that state and non-state actors could use AI to develop new weapons in areas such as chemistry and biology.

AI Raises Bioterrorism Concerns

Kiran Mazumdar-Shaw, founder and chairperson of Indian biotechnology company Biocon, also warned about the potential misuse of AI.

She said malicious actors could use advanced systems to design new viruses or pathogens. Mazumdar-Shaw called bioterrorism a major existential concern and urged stronger safeguards and governance.

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Her comments came as governments and technology companies face growing pressure to establish controls around increasingly capable AI systems.

The debate has also reached leading AI companies. Executives from major US AI laboratories recently called for caution over rapid development, citing concerns that future systems could improve themselves and move beyond effective human oversight.

Anthropic has separately warned prospective investors that advanced AI could create catastrophic or existential risks.

Investors Question AI Returns

Financial concerns remain another major part of the debate.

Strong investor confidence in AI has supported technology stocks and broader markets. However, questions are growing over whether companies can generate enough revenue and productivity gains to justify the huge sums being invested in AI infrastructure.

Rohit Sipahimalani, chief investment officer at Singapore’s Temasek, said the AI investment narrative could face pressure if safety concerns, regulation or weak returns undermine investor confidence.

He described the AI narrative as one of the biggest risks facing markets while noting that it remains strong for now.

The concern comes amid unprecedented spending on AI infrastructure. Reuters has reported that global data-centre investment could eventually reach tens of trillions of dollars, while major AI companies are planning enormous future expenditures.

Ray Dalio Warns of AI Bubble

Bridgewater Associates founder Ray Dalio took a more cautious view of the investment boom.

Dalio described AI as a “classic bubble” and distinguished between the value of a technology and the value of investing in companies linked to it.

He also warned that higher interest rates could put greater pressure on asset valuations. If borrowing costs begin to weigh more heavily on markets, he said, the AI bubble could start to deflate.

The warnings reflect a broader shift in the AI debate. Investors are no longer focused only on whether AI companies are overvalued. They are also examining whether the technology can deliver the productivity gains, revenues and economic transformation needed to support current investment levels.

AI Debate Enters a New Phase

AI investment remains strong despite the growing concerns. Yet policymakers and investors are increasingly calling for safeguards alongside technological development.

The debate now covers several risks at once, including financial instability, cybersecurity, labour-market disruption, autonomous systems and potential misuse in biological or weapons development.

The changing tone in Singapore suggests that the AI boom is entering a more cautious phase, with investors increasingly focused on both the technology’s potential and the risks surrounding its rapid expansion.