Malaysia has recorded RM385.7 billion in data centre-related investments from 2021 to the first half of 2026, as the Government calls for the sector’s rapid expansion to generate broader economic benefits beyond infrastructure development.
Deputy Investment, Trade and Industry Minister Sim Tze Tzin said Malaysia’s priorities must now evolve alongside the scale and pace of investments, with greater emphasis on artificial intelligence (AI) adoption, home-grown innovation, skilled talent and higher-value jobs.
“As the scale and pace of investment increase, our priorities must evolve with the industry. The next phase is about what that capacity delivers — AI adoption, homegrown innovation, skilled talent and higher-value jobs,” he said at Data Centre Nexus (DCN) 2026 today.
Sim said Malaysia wants to be recognised as a competitive, resilient and sustainable digital hub where infrastructure, technology, talent and innovation converge to create high-value economic activity.
“The next phase must carry us from building capacity to building capability, from attracting investment to creating value, and from single projects to a whole ecosystem,” he said.
“Ultimately, our success will be measured not by the investment or capacity we attract, but by the capabilities we build, the businesses we strengthen and the opportunities we create for Malaysians.”
Major global operators and investors including AWS, Microsoft, Google, Bridge Data Centres, DayOne, AirTrunk and Vantage Data Centres have established or expanded their presence in Malaysia, particularly in Greater Kuala Lumpur and Johor.
MIDA chairman Tengku Datuk Seri Utama Zafrul Tengku Abdul Aziz said the economic impact of data centres should extend beyond the facilities themselves, with opportunities for Malaysian companies to participate in the wider ecosystem.
“Our responsibility now is to build an industry that is sustainable, inclusive and enduring. Ultimately, we will not measure our success by the scale of investment we attract, but by the value we build around it – stronger Malaysian businesses, deeper local capabilities, and lasting opportunities for our people,” he said.
The wider data centre ecosystem covers engineering, construction, electrical systems, cooling, telecommunications, cybersecurity and logistics, creating opportunities for Malaysian businesses to strengthen their capabilities and take part in the supply chain.
MIDA chief executive officer Datuk Sikh Shamsul Ibrahim Sikh Abdul Majid said the agency was increasingly focused on ensuring Malaysia captures greater value from the sector’s growth.
“This year, we are not only asking how we grow the industry, but how we create lasting value for Malaysia,” he said.
He said the expansion of AI and digital infrastructure must also be matched by responsible management of energy, water and land, as well as the development of local capabilities.
The sector’s electricity demand is projected to exceed 5,000 MW by 2035, putting sustainability at the centre of Malaysia’s data centre development.
The Government has strengthened sustainability requirements through Power Usage Effectiveness (PUE) and Water Usage Effectiveness (WUE) metrics, alongside renewable energy initiatives including the Corporate Green Power Programme (CGPP), Large Scale Solar (LSS) and Corporate Renewable Energy Supply Scheme (CRESS).
A business matching session at DCN 2026 also connected 14 data centre companies with 51 Malaysian vendors, compared with eight data centre companies and 17 supply chain companies at the inaugural event in 2025.
The Data Centre Task Force, co-chaired by the Ministry of Investment, Trade and Industry (MITI) and Ministry of Digital, provides a coordinated mechanism to govern and facilitate data centre investments, with MIDA serving as the single focal point for new and expansion applications.
