Malaysia and the United Arab Emirates (UAE) have signed a Memorandum of Understanding (MoU) on Thursday, marking a strategic partnership on the development of data centers in Malaysia, with potential projects anticipated to achieve a total capacity of 500 megawatts.

The Ministry of Investment, Trade, and Industry (MITI) of Malaysia said in a statement that in collaboration with the Ministry of Investment of the United Arab Emirates (UAE), they have strengthened their commitment to advancing investment cooperation in the digital infrastructure

According to the statement, the MoU represents a strong commitment towards robust collaboration on the exchange of knowledge and expertise in the digital infrastructure sector between Malaysia and the UAE, which is also aimed at fostering greater bilateral economic and investment relationships between the public and private sectors of both countries.

It is noted that Malaysia has emerged as a preferred destination for data centers in the Southeast Asia region, thanks to its robust digital and physical infrastructure, rule of law, as well as compelling government-backed measures and initiatives on data center investment.

The increasing demand from regional small and medium-sized enterprises (SMEs) will provide the impetus for Malaysia’s growing status as a significant regional player in digital economy.

Beyond data centre development, the MoU also illustrates Malaysia’s commitment to advancing artificial intelligence (AI), in alignment with the New Industrial Master Plan
(NIMP) 2030, whose aims include enhancing the capacity of industries, SMEs and start-ups in AI and developing AI solution providers.

“Malaysia’s digital infrastructure collaboration with the UAE, with a focus on data centers, will certainly help strengthen our position as a preferred destination for digital investments, ” said Tengku Zafrul Aziz, Minister of MITI.

“By being a regional data center hub, Malaysia is well-positioned to capture a significant portion of ASEAN’s digital economy, forecast to reach $1 trillion by 2030,

“MITI and its agencies are determined to speed up the implementation of all committed investments so that investors, businesses and our people can quickly reap the benefits of a more robust, thriving digital economy within
Malaysia and ASEAN,” he added.

Meanwhile, Mohamed Hassan Alsuwaidi, Minister of Investment, the UAE, said this collaboration not only enhances the existing bilateral ties between his nations but also seeks to harness Malaysia’s extensive potential as a top choice for data center locations in the Asia-Pacific region.

“Being an emerging data hub in Southeast Asia, the arrangement aims to reinforce the nation’s digital infrastructure and accelerate the expansion of its internet economy, aligning with shared priorities and interests,” he added.

According to the statement, the MoU stands as a testament to the strong trade relations between Malaysia and the UAE, with significant growth in non-oil trade volume.

Currently, the UAE is Malaysia’s second-largest trading partner in the Middle East, and Malaysia is a key player in UAE’s exports and re-exports in the ASEAN region.

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