Malaysia's digital economy has experienced significant growth, marked by substantial investments and strategic initiatives aimed at enhancing its technological infrastructure. In 2024, digital investments reached a record RM163.6 billion, a notable increase from RM46.8 billion in 2023. This surge underscores Malaysia's emergence as a regional tech hub, bolstered by a stable government and pro-business policies. The growth is further supported by strong infrastructure and strategic public-private partnerships, which have enhanced investor confidence in the nation's digital sector. The government's focus on artificial intelligence (AI) and quantum computing has also attracted high-value global investments, contributing to the sector's expansion.
Major global technology companies have played a pivotal role in this development. Amazon Web Services (AWS) committed US$6.2 billion to establish the AWS Asia Pacific (Malaysia) Region, with operations expected to add approximately RM57.3 billion to Malaysia's gross domestic product by 2038. Microsoft announced an investment of US$2.2 billion in the country's cloud and AI infrastructure over the next four years, while Google plans to invest US$2 billion to develop its first data center and Google Cloud hub in Malaysia. These investments are anticipated to create thousands of high-skilled jobs and bolster Malaysia's position in the global digital economy.
In addition to foreign investments, Malaysia has prioritized the development of its digital infrastructure. The rollout of 5G networks has achieved 62.1% coverage of populated areas as of May 2023, with plans to reach 80% coverage by the end of the year. This expansion is crucial for supporting emerging technologies such as AI, virtual reality, cloud computing, and the Internet of Things. The government's commitment to enhancing broadband connectivity and digital infrastructure is evident in initiatives like the National Digital Connectivity Plan, which aims to ensure Malaysia's preparedness for the transition to 5G technology and continued digital growth.
Furthermore, Malaysia's digital economy has contributed significantly to the nation's GDP, accounting for 23.2% in 2021 and projected to reach 25.5% by 2025. This growth is driven by investments in data centers, cloud computing, data hosting, big data analytics, and AI. The presence of renowned global digital companies in Malaysia signals the country's attractive investment ecosystem and its potential for further growth in the digital sector.
Overall, Malaysia's strategic initiatives and substantial investments in digital infrastructure and technology have positioned the nation as a leading player in the regional digital economy, fostering innovation, creating high-value jobs, and contributing to sustained economic growth.