There is a growing list of places where AI companies cannot comfortably operate. The US wants its AI to stay American. China wants its AI ecosystem under government oversight. Between those two poles, a small city-state with a population of six million is positioning itself as the place where companies from both sides can do business without immediately picking a flag. Singapore's Economic Development Board has a phrase for it: "digital Switzerland."
The pitch is practical. Chinese AI startups setting up in Singapore can tell international clients that their intellectual property sits on an island not subject to Chinese government data requests. US AI firms can hire engineers without navigating an H-1B visa system that has become unpredictable under the Trump administration. Employment passes in Singapore are sometimes approved within three days. Anthropic, whose $30 billion fundraising round was led by Singapore sovereign wealth fund GIC, is reportedly planning a Singapore office. OpenAI, Meta's Superintelligence Labs, and Google DeepMind already have presences there.
The corporate behaviour that tells the most interesting story is what happened to Manus AI. The Chinese automation startup shifted its base to Singapore, began recruiting there, and was subsequently acquired by Meta in December 2025 for $2 billion. Singapore wasn't just an office location: it served as a corporate waystation that let a Chinese-founded company redomicile in a jurisdiction acceptable to a US acquirer. That is a more sophisticated function than just "neutral ground." It is part of an M&A pathway.
The limits of neutrality are becoming clearer at the same time. China imposed a travel ban on founders of Manus after the move to Singapore, and reportedly told AI startup MiroMind not to send talent abroad after it opened offices in Singapore, Japan, and the US. Beijing has also moved to require government approval for US investment in China's top AI firms. Singapore's neutrality depends on both superpowers tolerating it, and as Chong Ja Ian, a political scientist at the National University of Singapore, put it: "That could result in restrictions being placed on Singapore."
The conditions for the arrangement to work are also more demanding than they might appear. For a Chinese founder, setting up in Singapore only provides real cover if they no longer hold a Chinese passport, do not employ engineers in China, and have their company's revenue, data, and headquarters genuinely located there. Operating a shell office in Singapore while running the actual business from Shenzhen does not satisfy either the Chinese or American governments. The compliance burden for companies trying to maintain credibility with both sides is substantial.
Singapore has worked hard to create this opening: it published its first Model AI Governance Framework in 2019, updated it in 2020, and launched a framework specifically for generative AI in mid-2024, giving companies clear ground rules for deployment in a market that prizes regulatory predictability. It also offers a visa specifically for AI talent and tax breaks for registering intellectual property locally. The institutional scaffolding is genuine.
What remains unresolved is whether the two great powers will continue to tolerate a country that actively benefits from their rivalry by providing a bridge between them. The answer will likely be determined not by Singapore's policy design but by how US-China tensions evolve. For now, the city-state is threading a needle that gets narrower each year.