Microsoft invests US$1 billion in Malaysia to construct data centres

Microsoft Corporation will invest US$1 billion in Malaysia over the next five years as part of a new partnership with government agencies and local companies, Prime Minister Muhyiddin Yassin said on Monday (Apr 19).

The investment would be the US tech giant’s biggest in Malaysia.

The announcement comes after Malaysia in February gave conditional approvals for Microsoft, Google, Amazon, and state telecommunications company Telekom Malaysia to build and manage hyper-scale data centers in the country and provide cloud services.

It also comes after the country saw foreign direct investments (FDI) plunge by 68 percent last year, the biggest decline in Southeast Asia.

Malaysia has defended itself as an investment destination, with the finance minister recently saying it was looking at incentives to help attract more FDI.

It has said the investments from these cloud service providers will total between RM12 billion and RM15 billion (US$2.91 billion to US$3.64 billion) over the next five years.

As part of the Bersama Malaysia initiative, Microsoft will establish its first “data centre region”, which consists of multiple data centers in Malaysia to manage data from various countries, Prime Minister Muhyiddin told an event marking the launch of the program.

“The upcoming data center region will be a game-changer for Malaysia,” Microsoft Executive Vice President Jean-Philippe Courtois said in a statement, adding it will enable the government and businesses to “transform” their operations.

Under the program, Microsoft will also assist up to a million Malaysians in getting digital skills by the end of 2023.