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Malaysia's Ministry of Investment, Trade, and Industry (MITI) announced that it has formed a strategic partnership with the United Arab Emirates' Ministry of Investment to develop data centers in Malaysia.

The two ministries will reportedly collaborate to develop a robust digital infrastructure that will boost Malaysia's status as a regional data center hub, with potential projects totaling 500 megawatts.

Becoming the Preferred Destination for Digital Investments

According to MITI, Malaysia has already established itself as a preferred destination for data centers in Southeast Asia, and growing demand from regional SMEs will elevate its status as a major regional player in the digital economy.

This initiative not only enhances Malaysia's ability to accommodate the growing demand for data storage and processing but also positions it as an attractive location for both local and international businesses seeking reliable and advanced facilities to support their digital operations in Southeast Asia.

The development of data centers in Malaysia is particularly strategic in meeting the increasing demand from small and medium enterprises (SMEs) in the region. As SMEs play a significant role in Southeast Asia's business landscape, catering to their digital needs is essential for Malaysia's long-term competitiveness. By providing accessible and efficient data center services, Malaysia can solidify its reputation as a favorable destination for businesses of all sizes looking to harness digital solutions for growth and innovation. This focus on supporting SMEs underscores Malaysia's commitment to fostering economic development and technological advancement in the digital age.

Moreover, the establishment of data centers in Malaysia is expected to spur job creation, skill development, and technological innovation, contributing to the overall growth of the country's digital economy. These developments not only benefit the local workforce and economy but also enhance Malaysia's competitiveness on the global stage.

The Minister of Investment, Trade and Industry, Tengku Datuk Seri Utama Zafrul Tengku Abdul Aziz reportedly stated that the collaboration with the UAE “will certainly help strengthen our position as a preferred destination for digital investments.”

Zafrul Abdul Aziz added that Malaysia is well-positioned to capture a significant portion of ASEAN's digital economy, which is expected to reach USD 1 trillion by 2030.

Boosting AI Development

The MoU also outlined an AI component; MITI claims it aligns with the Malaysian government's New Industrial Master Plan (NIMP) 2030, announced in September of last year. Among other things, NIMP aims to boost AI development among industries, SMEs, and start-ups, necessitating a significant increase in data center capacity.

By capitalizing on the opportunities presented by the digital revolution, Malaysia can assert its position as a key player in the global digital economy and attract further investment in its digital infrastructure and innovation ecosystem.

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