UAE agrees to help Malaysia build more data centres

Malaysia’s Ministry of Investment, Trade and Industry (MITI) said on Thursday it has formed a strategic partnership with the Ministry of Investment of the United Arab Emirates (UAE) to to develop data centres in Malaysia.

Under an MoU signed yesterday, the two ministries will collaborate on digital infrastructure to boost Malaysia’s status as a regional data centre hub, with potential projects providing a total capacity of 500 megawatts, according to the Bernama news agency.

MITI said that Malaysia has already emerged as a preferred destination for data centres in Southeast Asia, and that growing demand from regional SMEs will boost its status as a major regional player in the digital economy, the report said.

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

Zafrul added that Malaysia is well positioned to capture a big chunk of the digital economy in ASEAN, which is forecast to reach US$1 trillion by 2030.

The MoU also comes with an AI angle – MITI says the MoU aligns with the Malaysian government’s New Industrial Master Plan (NIMP) 2030, revealed in September last year. Among other things, NIMP aims to boost AI development among industries, SMEs and start-ups, which will require plenty of extra data centre capacity.

As for the UAE, the main benefit of the MoU is enhancing bilateral ties between the two countries, particularly in terms of trade and investment. According to Bernama, the UAE is Malaysia’s second-largest trading partner in the Middle East, while Malaysia plays a key role in the UAE’s exports and re-exports in ASEAN.