Malaysia's data centres get boost with RM76bn investment

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Malaysia has received RM 76 billion worth of investments from its data centres from 2021 to March this year, according to Minister of Investment, Trade and Industry, Zafrul Aziz who was speaking at the grand opening of the GDS NTP data centre campus in Malaysia.

Minister Zafrul said that this was big growth in line with the government’s aim to make the country a data centre hub in Asia.

“As for the data centre market share in Malaysia, the projection is nothing short of remarkable, with an expected average annual growth rate of 16%, or USD2.08 billion from 2021 to 2026,” he said in his speech.

Don't miss: The rise of data centres is pushing demand for cloud services, says ISG report

Malaysia has increasingly captured the global data centre business in Southeast Asia, Minister Zafrul said. This, he added, is due to a combination of factors and natural advantages – proactive investor facilitation, cost-efficiency, plentiful landbank, and seamless connectivity to Asia.

“In our pursuit to achieve these goals, the government, through MITI and its agencies, has meticulously crafted the New Industrial Master Plan 2030 (NIMP2030). The NIMP2030 will be launched by the Prime Minister by end of this month. It is a game-changer that will catalyse Malaysia’s economic complexity and high-impact industrial growth through 2030,” he explained.

The NIMP2030 employs a mission-based approach to strategically promote five ‘economically complex’ industries, which he said can be expected to open doors to substantial development opportunities and to become the primary cornerstones for the nation's economic complexity and sustainable GDP growth.

Minister Zafrul also stated that digital transformation and connectivity will pave the way for Malaysian companies, especially the MSMEs to tap into more global opportunities. Empowered by enablers such as digital platforms and data centres, companies can build and expand their revenue streams and channels to thrive locally, regionally, and even globally.

Most recently, Amazon Web Services, a subsidiary of Amazon.com that provides on-demand cloud computing platforms, revealed plans to launch an AWS infrastructure region in Malaysia, with an investment plan of 25.5 billion in Malaysia by 2037.

The launch aims to give developers, start-ups, entrepreneurs, and enterprises, as well as government, education, and non-profit organisations a greater choice for running their applications and serving end users from data centres located in Malaysia.

This plan is also in line with Malaysia's ambition to be a data centre hub, especially since the rising enterprise demand for computing resources, particularly green data centres and hyperscale capabilities, is responsible for driving data centre expansion and modernisation. This was highlighted in The 2023 ISG private and hybrid cloud data centre services report for Singapore and Malaysia.

ISG’s principal consultant technology modernisation, Ben Rossiter, said that strong investments are turning Singapore and Malaysia into world-class data centre services markets. “We expect providers to keep expanding managed hosting capacity,” he explained.

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