May 31, 2024
PETALING JAYA – Four weeks after Microsoft unveiled its US$2.2bil investment in Malaysia, Google has pledged to invest US$2bil (RM9.4bil) that includes a hyperscale data centre to be built by Gamuda Bhd in Sime Darby Property Bhd’s Elmina Business Park.
The data centre will be Google’s first in the country and once operational, Malaysia will join the 11 countries where Google currently runs data centres to serve its global users.
The RM9.4bil investment also consists of the Google Cloud region that will join 40 regions and 121 zones currently in operations around the world.
The cloud region will be complemented by Google Cloud’s existing Dedicated Cloud Interconnect locations in Cyberjaya and Kuala Lumpur.
Ruth Porat, president and chief investment officer of Alphabet Inc and chief financial officer of Google, said the data centre and the cloud region was Google’s largest planned investment so far in Malaysia.
In a statement, the Investment, Trade and Industry Ministry (Miti) said the investment by Google will support 26,500 jobs across various sectors in Malaysia – including in healthcare, education and finance.
This is estimated to create a total economic impact valued at RM15.04bil (US$3.2bil).
The ministry said this latest commitment by yet another global tech giant to Malaysia represents a key milestone in the Madani government’s vision to attract more digital investors into the country, to help build a digitally enabled economy that is both strong and safe.
Google’s investment was announced after a series of Miti-facilitated engagements involving Prime Minister Datuk Seri Anwar Ibrahim with Porat.
A memorandum of understanding was also signed between the Malaysian Investment Development Authority and Google on Nov 14, 2023.
Anwar, via a Facebook post yesterday, said Google’s substantial investment reflected the government’s clear planning and the country’s ability to attract investors.
“In a virtual meeting with the senior management of Google on May 6, I emphasised that aside from the use of artificial intelligence (AI), there must be strategic cooperation in the areas of education, healthcare and agriculture,” he said.
“This is important to ensure that Malaysia can benefit from the skills and latest technology-based approaches,” he added.
It is noteworthy that the Google data centre will power its popular digital services such as Search, Maps and Workspace, while also playing an essential role in enabling Google to deliver the benefits of AI to users across the country.
The Google Cloud region, on the other hand, will deliver high-performance and low-latency cloud infrastructure, analytics and AI services to large enterprises, startups and public-sector organisations.
It also seeks to support AI literacy programmes for Malaysian students and educators.
Miti Minister Tengku Datuk Seri Zafrul Abdul Aziz said Google’s investment in Malaysia will significantly advance the digital ambitions outlined in the New Industrial Master Plan 2030.
He further noted that the Google data centre and Google Cloud region in Greater Kuala Lumpur will empower the country’s manufacturing and service-based industries to leverage AI and other advanced technologies to move up the global value chain.
“We also welcome Google’s plan to help us develop a robust talent ecosystem by facilitating the growth of our people’s digital skills, businesses and careers.
“As this attracts further investments, it will spur innovation and drive growth for organisations of all sizes.
“We are confident that Google’s partnership and continued investment will accelerate our nation’s digital transformation, contributing to the Madani vision towards a more prosperous, technologically advanced Malaysia.”
Tengku Zafrul pointed out that Malaysia’s steadfast commitment to robust digital infrastructure has convinced many multinationals to come to its shores, resulting in RM144.7bil of digital investments approved from 2021 to 2023.
“As Miti actively nurtures an empowering digital ecosystem that will drive tech-based solutions across various sectors, it will also strengthen our value proposition that Malaysia is where global starts, the place to be for companies to strengthen their regional and global operating success,” he said.
Meanwhile, Porat said: “This investment builds on our partnership with the Malaysian government to advance its ‘Cloud First Policy,’ including best-in-class cybersecurity standards.”
The investment by Google followed Gamuda’s announcement last week that its subsidiary, Gamuda Engineering Sdn Bhd, had secured a RM1.74bil contract to develop a hyperscale data centre in Elmina Business Park, Selangor.
The data centre will be on 19.83ha within the 607ha Elmina Business Park.
Gamuda said the development of the data centre will consist of two phases – the construction and mechanical work and electrical and plumbing fit-out.
The first phase has a contract value of RM815mil and is scheduled to begin on May 27, 2024 with a target completion date of Feb 27, 2026.
The second phase will be a separate contract valued at RM928.6mil which is set to cover the fit-out, testing and commissioning of the data centre’s mechanical, electrical and plumbing or MEP systems in Elmina Business Park 1A.
“This phase is expected to commence on July 1, 2025 and be completed by Sept 9, 2026,” according to Gamuda.
Elmina Business Park is owned by Sime Darby Property.
In recent times, Malaysia has been witnessing major investments in new data centres driven by demand from digitalisation, geopolitics and expectations for the potential of AI.
There are some 1,146.2MW of known proposed new data centre capacity in Malaysia.