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AI
is seen as a major boost to global productivity, but it requires
data centers and semiconductor plants that require huge amounts
of electricity.
BlackRock CEO Larry Fink spoke remotely at a meeting in Rome of
the B7 business groups of the Group of Seven (G7) states. The
conference preceded next week's meeting in Italy of finance
ministers and central bankers from the G7 more advanced
economies.
"These AI data centers are going to require more power than
anything we could ever have imagined. We at the G7 do not have
enough power," Fink said.
"I think this is going to create a real competitive challenge
for countries."
Data centers are likely to be built where power supply is
cheaper, raising the need for state subsidies in areas where
energy costs are not competitive, Fink said.
Investments to build the data centers and chip factories backing
AI technologies and power them, which BlackRock estimates "in
the trillions of dollars", require the participation of private
investors and could be a great opportunity for pension funds and
insurers, Fink said.
Japan on Tuesday said it envisages the need for electricity
output to rise 35% to 50% by 2050 due to growing demand from
semiconductor plants and data centers backing AI.
"We're in conversations with many governments right now about
how can we bring private capital," Fink said, adding G7 states
could not shoulder the cost given the risk of a "fiscal crisis".
"The deficits we're seeing in the G7 are becoming a burden for
my children, your children, our grandchildren."
(Reporting by Valentina Za, editing by Gavin Jones and Rod
Nickel)
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