Temasek Holdings is zeroing in on technologies of the future as its key area of investment in the next five years, Chia Song Hwee, Temasek International president and chief operating officer, said in Singapore on Friday.
Chia said this is Temasek’s response to anticipating trends that cut across all sectors as it “tries its best to get ready for the future”. These trends include automation, sharing economy, smart factories, and artificial intelligence and robotics, among other technologies. He specifically called out cross-border B2B payments and fraud detection as areas of interest.
On fraud detection, Chia said: “The amount of transactions, financial transactions going through the digital platform today have grown tremendously, especially in China. So being able to prevent fraud, to detect them is going to be a very important part of the development; and we believe that there are a lot of opportunities there, and that’s a space that we would like to put more money to work.”
He added that Temasek is also tapping more opportunities in South-East Asia and is increasingly trying to integrate the element of sustainability in its investment approach in order to make better returns.
Temasek manages S$275 billion ($203 billion; €173 billion) of assets as at 31 March 2017. It reported a 13 percent return for 2016, reversing the previous year’s negative 9 percent return, boosted by divestments of assets totalling S$18 billion.
Temasek has been reshaping its portfolio since 2011 in terms of geographical exposure and sectoral focus. From an Asia-centric portfolio six years ago, the investor has shifted its emphasis on the US and Europe. Its OECD exposure rose to 28 percent in 2017, from 20 percent in 2011. Meanwhile, Singapore decreased from 32 percent to 29 percent, and Asia (excluding Japan and Singapore) slid from 45 percent to 39 percent.
As at March 2017, new focus areas as listed above took up 24 percent of its portfolio, from just 8 percent in 2011. The investor also trimmed its exposure to financial services (36 percent to 21 percent), telecom (21 percent to 17 percent) and industrials (23 percent to 17 percent).
Temasek is an early investor in e-commerce giant Alibaba. It has also backed NextEV, an electric vehicle company start-up in China, and Impossible Foods, a California-based company that makes plant-based burger patties.