Article written by Joyce Low, founder of industrialspace2u.com
Malaysia, Data Centre Hub in South Asia
The demand for data centres experienced exponential growth driven by the digitalization of operations by companies as well as governments hastened by the Covid-19 pandemic. Cloud computing services run on the back of data centres. Asia is fast becoming the most important destination for the data centre industry because of resource availability and growing demand.
The Malaysian government has recently launched the Malaysia Digital Economy Blueprint (MyDIGITAL) to transform the country into a digitally driven, high-income nation and a regional leader in digital economy. As part of the MyDIGITAL blueprint, the government has pledged to have 80% of its data stored on cloud platforms by 2022, besides striving for a digitally literate civil service. The government also intends to have 80% of its end-to-end services conducted online with all government ministries and agencies are to use cashless payments. Apart from the renewed emphasis on 5G infrastructure, which is being addressed via the Government’s Special Purpose Vehicle (GOMSPV) for 5G, international connectivity and the availability of hyper scale data centres plus cloud services are also fundamental digital infrastructure necessary to attract high-quality digital investments to accelerate digital innovations across various industries by businesses seeking to future-proof themselves. Malaysia will continue to build and attract submarine cable systems as international connectivity not only lowers internet costs but also has income-enhancing spillover effects. Malaysia has a strategic geographical advantage when it comes to attracting investments in this key area.
Data centres are typically made up of a large group of networked computer servers that provide remote storage, processing or distribution of large amount of data. However, data centres require high capital expenditure for the cost of the servers and infrastructure especially on the high-speed connectivity and cooling systems needed.
Malaysia is gaining traction for data centre investments owing to the land shortage faced by Singapore. Scarcity of land in Singapore has driven data centres to be housed in four storey building as well as construction of floating data centres that are similar to offshore rigs. The spillover effect will benefit neighbouring country such as Malaysia. Malaysia which is located away from the tectonic plates is blessed as it is largely free from natural disaster such as earthquake and typhoon. With infrastructure such as stable electricity supply as well as gas supply being available, backup power supply using gas power plant is a possibility to ensure there is no power outrage disrupting the data centre’s operation. With an abundance of land that is priced at an affordable price, Malaysia offers ease of access and lower cost of entry compared to Singapore.
Malaysian Industrial Development Authority (MIDA) offers tax incentive in the form of 100% Investment Tax Allowance for qualifying capital expenditure to encourage the use of green technology in data centres. Green data centres is designed with optimum efficiency in order to be sustainable given the hot and humid weather in Malaysia. Among the sustainable infrastructure features which can be adopted include:
Among the locations at which Data Centres have been established in the Central region of Peninsular Malaysia include (1) Techpark@Enstek (2) Cyberjaya as well as (3) Bukit Jalil.
We look forward to assist in the set up your data centre in Malaysia. Do contact me at +6017 333 8007 or email joyce@industrialspace2u.com for more information about the industrial properties available for sale or rent!