As America experiences a populist backlash against artificial intelligence, epitomized by support for moratoriums on data center construction, Malaysia shows how eager the developing world is to capitalize on this transformative technology that locals know will improve the economy.
The Southeast Asian country of 36 million people has opened up enthusiastically to data center investment and aims to be an “AI nation” by 2030. Malaysia ranks among the world’s top 10 destinations for data centers, according to the United Nations Trade and Development office. Most data centers in Malaysia are unusually large hyperscale facilities.
Malaysia now has 1,318 megawatts of operating capacity, ranking it just below much more populous China, India and Japan but above Singapore. Another 1,039 megawatts of capacity is under construction, and even more is in the planning phase. On a per capita basis, Malaysia’s megawatt operating capacity is 10 times China’s.
The Malaysian government’s open-arms approach has already been a boon. Data center investment is now equivalent to roughly 18 percent of the country’s gross domestic product, the highest share in the world. The push, led by Prime Minister Anwar Ibrahim, is aimed at moving the country up the economic value chain, away from electronics assembly and into high-end chipmaking and design.
Malaysia, as a nonaligned but America-friendly country in the heart of Asia, has been able to avoid getting drawn into the superpower rivalry. Microsoft, Google and Amazon have hyperscale data center or cloud infrastructure in Malaysia, along with Chinese tech giants ByteDance, Alibaba and Tencent. (Amazon’s executive chairman, Jeff Bezos, owns The Post.)
Malaysia also benefits from its proximity to neighboring Singapore, a major financial hub. In 2019, Singapore imposed a temporary moratorium on data centers because of concern over the strain on resources. That triggered the building boom in Malaysia’s southernmost Johor state, just across the causeway.
The vast majority of Malaysian consumers haven’t seen a rise in their electricity rates despite the proliferation of data centers. The tech companies pay for the power they use, as well as any costs to upgrade the grid.
There has been some limited public opposition. A small opposition party in Johor, the Malaysian United Democratic Alliance, or Muda, tried to ride criticism of data center expansion in local elections in July, calling for tighter regulations. But the state’s ruling coalition was reelected with an even bigger majority, and the anti-data-center party was unable to secure a single seat.
The post What the U.S. can learn from Malaysia’s embrace of data centers appeared first on Washington Post.
