The Asia-Pacific Data Center Association (APDCA) has projected that the sector could generate approximately $34 billion in total economic output and support 30,900 jobs by 2030 — up from $1.4 billion and 4,400 jobs in 2024.

APDCA said in a report revealed on last Thursday that across both construction and operation, data centers in Malaysia could contribute about 4.1 percent of national economic output and about 3.5 percent of gross value-added (GVA) by 2030, respectively.

As strategic digital infrastructure, data centers generate investment, support highly-skilled jobs, and enable growth across Malaysia’s most dynamic sectors, it noted.

Their enabled impacts including productivity growth and a competitive economy; digital service delivery including critical infrastructure for high growth fintech, artificial intelligence (AI), e-commerce sectors and public services; facilitating exportable digital services.

It highlighted that investment in data center capacity is a catalyst for Malaysia’s digital economy – enabling high-value jobs and innovation, while also delivering direct economic benefits through construction and operations.

According to the report, Malaysia’s data center capacity could grow from 505 megawatt (MW) in 2024 to between 2.1 gigawatt (GW) and 5.1GW in 2030.

Under the baseline scenario, the association estimates that Malaysia’s operational capacity could grow from 505MW in 2024 to 3,578MW in 2030 at an average compound annual growth rate (CAGR) of 38 percent.

As around 70 percent of all data center applications are assumed to be delivered in this scenario. An increase or decrease in the number of projects accepted could result in a higher or lower operational capacity by 2030.

To reach the high scenario, APDCA noted that the government could continue to streamline the application process to ensure more data centers are approved and developed resulting in a higher overall MW capacity in 2030.

This can support Malaysia’s ambition to become Southeast Asia’s major AI data center hub.

In 2024, a total of 54 operational data centers were located across Malaysia.

Johor accounted for 79 percent (397MW across 12 data centers) of Malaysia’s data center capacity in 2024, with investor interest now spreading across the country to regions in Northern Malaysia.

This was followed by 20 percent (107MW) across 37 data centers in the Klang Valley region.

Five data centers providing combined capacity of 1MW were in the Sarawak and Penang regions.

According to the report, Malaysia is one of the fastest growing data center markets in Asia Pacific (APAC), with total capacity forecast to double from 1.26GW to 2.53GW and colocation revenue rising from $0.71 billion to $1.87 billion between 2025 and 2030 – representing compound annual growth rates (CAGRs) of 15 percent and 21 percent respectively.

This growth trajectory reflects increasing hyperscale and enterprise demand, supportive government policy (e.g. Malaysia Digital and green investment tax allowance [GITA] incentives), and Malaysia’s positioning as a hub in Southeast Asia.

While Singapore remains a high-value, mature hub, APDCA pointed out that its future growth is constrained by land and energy limitations.

In contrast, it opined that Malaysia combines strong policy support, land availability and competitive costs positioning it as an attractive location for colocation providers in Southeast Asia.

“As Malaysia positions itself as a regional digital hub, data centers are the foundational infrastructure that powers and enables AI, cloud adoption, and digital transformation across sectors,” said Jeremy Deutsch, Chair of the APDCA.

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