Khaldoun Al Mubarak, CEO of Mubadala, Abu Dhabi's sovereign wealth fund
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The world has not fully realized how much artificial intelligence will change every aspect of human life, the CEO of Abu Dhabi sovereign wealth fund Mubadala told CNBC at the World Economic Forum in Davos.
“In terms of risk… this is a technology that no one really appreciates today, really the level of disruption that it's going to create, that's going to impact everything from our lives, our businesses, our human capital, employment, every sector is going to be affected.” Khaldoon Al Mubarak, managing director of the $330 billion fund, told CNBC's Dan Murphy:
“And I think that even though there is a lot of opportunity, it also represents a lot of risk, which is not evident today, because technology is moving so quickly and we are all trying to catch up as much as possible.”
Al-Mubarak pointed to Mubadala’s efforts in the field of artificial intelligence and the infrastructure that supports the thriving technology, including data centers and chip manufacturing.
Mubadala is a founding investor in MGX, Abu Dhabi’s AI-focused investment vehicle. The fund participated in OpenAI Latest fundraising round In October, which raised $6.6 billion. In the same month, the wealth fund's artificial intelligence company G42 announced a partnership with OpenAI to develop artificial intelligence in the UAE and regional markets.
Microsoft last year Invested $1.5 billion in G42in a deal that will see G42 use Microsoft's cloud services to power its AI applications. In December, Washington agreed to export advanced AI chips to a facility in the United Arab Emirates run by Microsoft as part of the G42 deal, which has come under intense scrutiny by US lawmakers over security concerns.
Al-Mubarak expressed his optimism about the future of artificial intelligence and the UAE’s ability to benefit from its investment strategy to benefit from it.
“The demand will be very high in terms of enabling this technology,” he said. And that means “technology, enabling AI, which is the infrastructure aspect of it – whether that's energy, whether it's transportation, but also all forms of technology, energy technology that will help fuel this huge demand, I would also add to data center building and chip building.” “
“When you look at a 10-year horizon, which is the way we look at these investments — we're not looking at one or two years, we're looking at the next five, 10, 20 years. And I think the growth in this demand is very strong, and even if “I took a conservative view, there is tremendous growth coming in this area.”
“That's what gives me a lot of confidence. I think that's where I see the opportunity.”
It remains committed to China
Given the global political landscape, Al Mubarak said that Abu Dhabi Wealth Fund plans to continue investing in China despite the potential trade headwinds expected under the new Donald Trump administration and the economic slowdown in the country.
“I would say I remain committed to investing in China,” especially if trade tariffs are revived, Mubarak said after being asked whether the Asian economic powerhouse is investable during the Trump era.
“Let's look at the basics. When you look at the Chinese economy, it's the second largest economy in the world. You have a population of 1.4 billion people. And you have a large middle-income population that is growing. And you have GDP growth constantly so I think These are all, let's say, basic frameworks for how we look at China.
The investment chief pointed to major Chinese cities Shanghai and Hong Kong that saw double-digit returns as markets for 2024: the Shanghai Composite Index rose 12.7% last year, and Hong Kong's Hang Seng Index gained nearly 18% in 2024.
He also pointed to the Chinese government's efforts to give markets a boost towards the end of last year by cutting interest rates and announcing broad stimulus plans.
“I think that on the consumer side, China has a lot to offer, and I think it will continue to provide good opportunities,” he said. He added: “Tariffs, trade, wars, whatever word you want to use, I think these are all challenging. I think not just for China, and I think for the world, but I feel that ultimately, there are enough pragmatic solutions.” A reasonable and calm landing would, I believe, lead to an ideal outcome for everyone.”
Al-Mubarak said Chinese policymakers should do more to support the country's domestic economy, which slowed last year due to the real estate market crisis, slowing consumer spending, aging population, and geopolitical competition.
“Yes, I think the domestic economy is obviously important, especially given the way trade has evolved or the global trade situation has developed,” he told CNBC. “Anything to help continue to strengthen the Chinese consumer market, I think is a positive signal for the markets.”
