<\/p>\n
Foreign investors are increasingly funding the growth of artificial intelligence computing across North America, JPMorgan Asset Management\u2019s Charles Wu told an audience at the SuperReturn conference in Singapore on Wednesday.<\/p>\n
Foreign banks and institutional investors including pensions, sovereign wealth funds and insurance companies from regions including Asia and the Gulf are playing a major part in funding the expansion of a sector where capital expenditure stands at almost $1 trillion, said Wu, the bank\u2019s head of Asia Pacific alternatives institutional client strategy.<\/p>\n
\u201cCompute training assets are still largely in North America,\u201d he said on a panel. \u201cOn the banking side and also on the asset management side, the capital providing the funding for these assets is largely becoming more global.\u201d<\/p>\n
How global investors approach the AI trade \u2013 including the mammoth funding needs for the world\u2019s data centres \u2013 has been a key topic of conversation at the SuperReturn event this week. Most panellists have struck a positive tone, but there are also detectable notes of caution.<\/p>\n
Read: Big tech\u2019s costly AI race is fuelling hundreds of billions of dollars in debt deals<\/p>\n
\u201cWe\u2019re being very careful with the way we assess the risk,\u201d said Jean-Christophe Aubert, a senior director of infrastructure investments at PSP Investments.<\/p>\n
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\u201cConcentration is a big point, but also for us, given the amount of capital that we would have to put to work, is trying to understand how can we ultimately realise those assets going forward.\u201d<\/p>\n
While US hyperscalers are funding much of the AI capex need through operating cash flows, they are also getting about $250 billion from the bond market and roughly the same amount from bank loans, said Wu.<\/p>\n
He warned that his firm was keeping an eye on concerns including lease commitments and concentration risk, as well as the risk that some of the financing is being raised off balance sheet.<\/p>\n
\u201cThe reality is a lot of these funding securities, whether you\u2019re talking about investment-grade bonds, 144a, private placements, even private credit structured deals \u2013 a lot of them seem to all triangulate to basically five key hyperscaler parties,\u201d he said. \u201cEither as a guarantor, as a tenant, as a funding source, or as a customer.\u201d<\/p>\n
Asia emerges as a key AI market<\/p>\n
While the US remains the dominant market, several of the panellists agreed that Asia is likely to be close behind. The nature of inference \u2013 the actual use of AI models \u2013 benefits from being close to end users, which will help drive huge demand for infrastructure in the region.<\/p>\n
\u201cAsia is equally important as it plays an interesting role in both the demand side of the equation and the supply side through the physical stuff,\u201d said Mohsin Pirzada, head of funds at Qatar Investment Authority.<\/p>\n
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\u201cWhat we\u2019re starting to see is a decentralisation, and that\u2019s being driven by end consumer demand\u201d as well as data sovereignty and security, he said.<\/p>\n
Read:
AI frenzy draws stock traders to Southeast Asia\u2019s likely winners
Chatbots, AI news readers: Asia embraces automation despite job loss fears<\/p>\n
The panellists also agreed that energy remains a major bottleneck for a variety of reasons. With gas being a go-to power source, a shortage of gas turbines is causing challenges for data centres trying to scale. I Squared fund partner Chenhua Shen said Asia\u2019s power markets were less liberalised, making access to utilities harder.<\/p>\n
\u201cIt becomes a major obstacle for Asia to leapfrog,\u201d she said. \u201cBut we are still very optimistic in a way because Asia enjoys very abundant renewables.\u201d<\/p>\n
\u00a9 2026 Bloomberg<\/p>\n
#Global #cash #funding #boom #fears #hidden #debt<\/p>\n","protected":false},"excerpt":{"rendered":"
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