Khaldoon Al Mubarak, CEO of Mubadala, Abu Dhabi's sovereign wealth fund
Marc Atkins | Getty Images Sports | Getty Images
The world has yet to fully recognize the scope of the changes AI will bring to every aspect of human life, the CEO of sovereign wealth fund Mubadala Mubadala told CNBC at the World Economic Forum in Davos.
“In terms of risk… this is a technology that no one today really appreciates, really underestimates the level of disruption it will cause, impacting everything from our lives, our businesses, human capital, employment, every sector that will be disrupted,” Khaldoon Al Mubarak, managing director of the $330 billion fund, told CNBC's Dan Murphy.
“And I think that while there are a lot of opportunities, there are also significant risks, which is unclear today because technology is moving so fast and we're all trying to catch up as much as we can.”
Al Mubarak described the impact Mubadala is having on artificial intelligence and the infrastructure supporting the emerging technology, including data centers and chip manufacturing.
Mubadala is the founding investor of MGX, an Abu Dhabi-based investment vehicle focused on artificial intelligence. The fund participated in OpenAI last round of collection in October, which raised $6.6 billion. In the same month, wealth fund AI company G42 announced a partnership with OpenAI to develop AI in the UAE and regional markets.
Last year Microsoft invested $1.5 billion in G42as part of a deal under which G42 will use Microsoft's cloud services to run AI applications. In December, Washington approved the export of advanced AI chips to a facility in the United Arab Emirates run by Microsoft under the G42 deal, which has been closely scrutinized by US lawmakers for security reasons.
Al Mubarak expressed optimism about the future of artificial intelligence and the UAE's ability to leverage its investment strategy to leverage it.
“The demand for the use of this technology will be extremely high,” he said. This means that “the technology, the capabilities of artificial intelligence, that is, its infrastructure – whether it is energy, whether it is transmission, but also all forms of technology, energy technology, that will help meet this huge demand, I would also add data center expansion and chip expansion.”
“When we look at the horizon of 10 years, and that's how we look at these investments – we don't look at one or two years, we look at the next 5, 10, 20 years. And I think the increase in this demand is so great that even if we take a conservative approach, there will be an overwhelming increase in this area,” Al Mubarak emphasized.
“It gives me a lot of confidence. I think that's where I see it and we see an opportunity.”
Still committed to China
Looking ahead to the global political landscape, Al Mubarak said the Abu Dhabi wealth fund plans to continue investing in China despite potential trade obstacles expected under the new Donald Trump administration and the economic slowdown in the country.
“I remain, I would say, committed to investing in China,” Al Mubarak said after being asked whether it was possible to invest in the Asian economic powerhouse under Trump, especially if trade tariffs were reinstated.
“Let's look at the basics. When you look at the Chinese economy, it is the second largest economy in the world. The population is 1.4 billion people. You have a significant middle-income population that is growing. You're seeing steady GDP growth. So I think that's all, let's say, the basic framework of how we look at China.”
The head of investment pointed to the main Chinese cities, Shanghai and Hong Kong, which as markets recorded double-digit returns in 2024: the Shanghai Composite Index increased by 12.7% last year, and the Hang Seng Index in Hong Kong gained almost 18% in 2024 %.
He also noted the Chinese government's efforts to stimulate markets late last year by cutting interest rates and announcing sweeping stimulus plans
“I think on the consumer side, China has a lot to offer and I think it will continue to provide good opportunities,” he said. “Tariffs, trade, wars – whatever word you want to use, I think it's all challenging. “I think not just for China, I think for the world, but ultimately I feel there is enough room for a pragmatic, sensible, soft landing that I think would provide an optimal outcome for everyone.”
Al Mubarak did say that Chinese policymakers should do more to shore up the country's economy, which slowed last year due to the housing crisis, weak consumer spending, an aging population and geopolitical competition.
“Yes, I think the domestic economy is obviously crucial, especially given the evolution of trade and the global trade situation,” he told CNBC. “And anything that helps further support the Chinese consumer market is, in my opinion, a positive sign for the markets.”