Malaysia aims for a more selective approach to new data centres

As Malaysia seeks to attract more meaningful investments, new data centres should only be pursued if they bring clear benefits to the people.

Liew Chin Tong, the Malaysia Deputy Minister of Investment, Trade and Industry, said this at the W.Media - Global Malaysia CDC in KL last week.

I've previously written about how Malaysia's data centre market has taken off like a rocket - and how it will soon surpass Singapore's 1,400MW.

Liew's candid speech offered a clear look at the Malaysia government's current strategy for data centres.

Data centres in Malaysia

According to Liew, multiple government agencies are working hard to craft guidelines to regulate the data centre industry.

They are examining:

• PUE.
• WUE (Water Usage Effectiveness).
• CUE (Carbon Usage Effectiveness).

The focus is not solely on data centres but also on developing:

• Local businesses.
• Tech ecosystem.
• DC-related jobs.

In that context, data centre investments should only be pursued if they bring tangible benefits to Malaysians, says Liew.

Five questions to consider

Addressing a packed room of delegates, Liew shared five challenges he hopes the data centre industry will work together on.

• Create high-value jobs.
• Address water consumption.
• Tackle energy use for sustainability.
• Manufacture data centre equipment locally.
• How to curb speculative data centre builds.

On the final point: "We also need to ensure that there is no speculative [building]. It is in the interest of data centre operators... to ensure there is no speculative [building] in this industry."

The pay disparity

Liew shared an anecdote shared by the Menteri Besar of Johor regarding the pay disparity in Singapore and Malaysia.

This is something known to those in the industry:

• S'pore DC operator: S$4,000 (US$3K).
• M'sia DC operator: RM4,000 (US$0.9K).

Liew said:

"Now, this is a question we have to ask. How do we create jobs that pay well? How do we benchmark pay?"

"Malaysia is a Singapore at a discount. We have to start thinking about paying more... There is no talent problem in Malaysia; the only problem is Malaysian talents are working in Singapore."

A call for trade associations

Liew wrapped up his speech by calling for data centre operators to form trade associations for policy advocacy that benefit the industry and Malaysia.

Speaking at a separate GDS event in Johor on Sunday, Liew again urged data centre operators to form trade associations.

Benefits:

• Discuss sectoral policies.
• Regulate speculative builds.

Where do you see the Malaysia data centre industry heading?