UAE, Malaysia forge strategic partnership to advance digital infrastructure development

The UAE and Malaysia have taken steps to enhance bilateral development in digital infrastructure by signing an agreement to establish a framework for investment cooperation in the field. According to the Emirates News Agency (WAM), the agreement specifically emphasizes the establishment of data centers in Malaysia. Additionally, its primary objective is to foster robust and efficient collaboration between public and private organizations in both countries.

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Promotion of digitization and adoption of advanced technologies

The agreement was signed by Mohamed Hassan Alsuwaidi, UAE minister of Investment, and Tengku Zafrul Aziz, minister of Investment, Trade, and Industry of Malaysia. It proposes the introduction of incentives to support relevant initiatives and facilitate the exchange of knowledge. It aims to promote digitization across key sectors and accelerate the adoption of advanced technologies and digital solutions, ultimately enhancing productivity and efficiency in various industries.

Malaysia’s dynamic data center market

Malaysia’s reputation as one of the most dynamic data center markets in the Asia Pacific region is reinforced by its strategic location, robust infrastructure, and government-backed initiatives such as the New Industrial Master Plan 2030.

Increasing demand from small and medium-sized enterprises (SMEs)

Data centers are crucial for organizations to store important data and operate applications. Currently, Malaysia operates over 40 data centers, and it is projected that the sector will experience a compound annual growth rate of approximately 16 percent between 2022 and 2027, reaching $2.90 billion by the end of that five-year period. This growth is driven by increasing demand from small and SMEs, which play a crucial role in the country’s economy.

UAE-Malaysia trade relations in digital infrastructure

Minister Mohamed Alsuwaidi noted that the planned increase in the number of data centers in Malaysia will elevate the country’s status as one of the emerging data hubs in Southeast Asia, providing businesses across various sectors with a solid foundation for digitization.

Furthermore, the Minister of Investment, Trade, and Industry of Malaysia stated that the collaboration with the UAE in digital infrastructure, with a specific focus on data centers, will strengthen Malaysia’s position as a preferred destination for digital investments. Currently, the UAE is Malaysia’s second-largest trading partner in the Middle East, accounting for 32 percent of its overall trade with Arab nations. In addition, Malaysia ranks eighth among non-Arab Asian countries for UAE exports and nineteenth in terms of re-exports.

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