KUALA LUMPUR: Malaysia has stopped the development of new data centers not dedicated to artificial intelligence, citing concerns over power and water resources. Prime Minister Anwar Ibrahim announced Tuesday that the country is shifting focus to AI facilities.
Malaysia has become a significant IT infrastructure hub in Southeast Asia but faces rising demands for electricity and water to operate these facilities. Anwar stated that applications for new data centers unrelated to AI have been halted.
However, projects offering high-technology benefits for AI will still be approved. While current energy supply is sufficient, Malaysia is exploring future options, including tapping into the ASEAN Power Grid and leveraging abundant renewable energy from Sarawak state.
The move follows Singapore's previous halt on data center development, which redirected international tech companies to Malaysia. The southern state of Johor has seen rapid growth, prompting stricter water and power usage regulations for new data centers to prevent straining local resources.