Data centres have emerged as crucial infrastructure for Malaysia’s digital economy, offering significant spinoff effects that extend beyond their immediate function. According to Minister of Digital Gobind Singh Deo, the growth of data centres is essential for enabling artificial intelligence (AI) and other digital technologies that are increasingly central to both government and corporate strategies.
Key Takeaways:
Critical Infrastructure for AI and Digital Solutions: Gobind emphasizes that many of today’s solutions, particularly those based on AI, require substantial data centre capacity. As Malaysia aims to advance its digital economy, having the necessary infrastructure to support these technologies is crucial. This infrastructure is not just about supporting existing industries but also about enabling the emergence of new tech-driven industries.
Significant Economic Impact: Malaysia recorded a 23% year-on-year increase in approved investments to RM329.5 billion in 2023, with a substantial portion driven by digital investments, including data centres and cloud computing. The digital economy contributed approximately 23% to Malaysia’s GDP from 2021 to 2023, with a target to increase this contribution to 25.5% by 2025. Notably, Google’s US$2 billion investment in a data centre in Shah Alam is expected to create 26,500 jobs and generate an economic impact of RM15.04 billion.
Addressing Criticisms and Resource Use: While data centres have been criticized for their resource-intensive nature, including high electricity and water usage, Gobind notes that the government has considered these challenges. The administration is focused on ensuring sustainable growth and maintaining adequate reserves of critical resources while promoting data centre investments. Gobind underscores the importance of not missing out on the digital economy revolution, suggesting that Malaysia must embrace these investments to remain competitive globally.
Attracting Global Investments: Gobind highlights that data centre investments are not only about immediate economic benefits but also about creating a “buzz” to attract further global investments. As Malaysia positions itself within ASEAN and the broader global market, having advanced digital infrastructure is key to drawing in more investment and fostering economic growth.
In summary, data centres are pivotal to Malaysia’s strategy for enhancing its digital economy and attracting global investments. Despite the challenges associated with resource use, the government is committed to ensuring that Malaysia is well-prepared for the future, with data centres playing a central role in this vision.
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