The Government is always proactive in attracting high-quality investments, including investments in Artificial Intelligence (AI) to enhance technological capacity development, thereby contributing towards establishing the country as a digital investment hub.
Deputy Investment, Trade and Industry (MITI) Minister Liew Chin Tong, in the Dewan Rakyat today , said the East Asia Forum article by Albert Jehoshua Rapha actually calls for ASEAN countries to collaborate in developing a governance framework for AI technology use, rather than competing against each other.
Liew said, according to the Global AI Index 2023, a country's AI progress is assessed based on key aspects such as investment, innovation, and implementation. Malaysia ranks 44th in this report, ahead of neighbouring countries like Indonesia (46th) and Vietnam (47th), while Singapore leads ASEAN countries at 3rd place.
Liew said this in reply to a query raised by Dato' Shamshulkahar Mohd Deli [Jempol] who requested the Minister Of Investment, Trade And Industry (MITI) to explain why a significant portion of Artificial Intelligence (AI) investment in Southeast Asia is more concentrated in Singapore (US$8.4 billion) and Indonesia (US$1.9 billion) compared to Malaysia (approximately US$371 million), based on the East Asia Forum report, and what measures the Government is taking to encourage AI-related investments in Malaysia.
"Additionally, according to the Oxford Insight report, The Government AI Readiness Index 2023, which measures countries' readiness worldwide to adopt and implement AI technology in the public sector, lists Malaysia at 23rd place compared to Thailand (37th), Indonesia (42nd), Vietnam (59th), and the Philippines (65th), with Singapore ranked 2nd."
Liew said domestic AI investments in Malaysia are on a positive trend. As announced by Minister Tengku Zafrul Abdul Aziz and Prime Minister Datuk Seri Anwar Ibrahim and recent commitments from global technology giants include:
i. Amazon Web Services (AWS) on March 2, 2023, announced an investment estimated at US$6 billion (RM25.5 billion) over more than 15 years to establish new infrastructure regions in Malaysia. This investment will have a significant impact on innovation and digital transformation in the country.
ii. Nvidia on December 8, 2023, announced an investment of US$4.29 billion (RM20 billion) in collaboration with YTL Power International to build an AI data centre in Johor.
iii. Microsoft on May 2, 2024, announced an investment of US$2.2 billion (RM10.5 billion) to build cloud infrastructure and AI in Malaysia. This investment commitment will support robust cloud and AI infrastructure development while providing business opportunities for local companies.
iv. Google on May 30, 2024, also announced an investment of US$2 billion (RM9.4 billion) to build its first data center and Google Cloud region in Malaysia. This investment aims to meet the demand for AI and cloud computing services and provide access to the latest cloud technologies for local companies.
"Through AI-related investments, MITI and the Government aim to develop a comprehensive digital economic ecosystem and promote the use of AI technology in various fields, including smart manufacturing. The National Investment Council chaired by the Prime Minister during the 4th Meeting of 2024 in June agreed to enhance current policies regarding data centre investments," liew added.
These improvements are based on three main aspects:
i) Power Usage Effectiveness (PUE) and Water Usage Effectiveness (WUE), as well as ensuring sufficient Renewable Energy (RE) supply;
ii) Development of local vendors (localisation); and
iii) Collaboration with universities and technical institutions to develop local talent.
These Government efforts are expected to boost economic growth towards establishing the country as a digital investment hub and an AI hub in the region, Liew said.