Microsoft’s Malaysia Cloud Region to Boost Economy and Create Jobs
Microsoft’s forthcoming cloud region in Malaysia, dubbed Malaysia West, is poised to generate substantial economic benefits, according to recent announcements. The cloud region, Microsoft’s first in the country, is expected to be live by the second quarter of 2025, bringing with it a significant economic boost.
Laurence Si, Managing Director of Microsoft Malaysia, stated that the project is projected to generate US$10.9 billion in economic impact over the next four years. This includes the creation of 37,575 jobs, with 5,700 of those being skilled IT roles. The announcement builds on the US$2.2 billion (RM9.71 billion) cloud and AI infrastructure investment Microsoft Chairman and CEO Satya Nadella announced during a 2024 trip to Kuala Lumpur.
The Malaysia West Cloud Region will feature three data centers in the Greater Kuala Lumpur area, scheduled to launch simultaneously in Q2 2025. At least one of these will be a new facility in Cyberjaya, nearing completion. While Microsoft did not confirm if any of the centers will be co-located, it’s worth noting that Microsoft currently operates a data center in Cyberjaya as part of a co-location with Bridge Data Centres, a subsidiary of Chindata Group.
Of the projected US$10.9 billion economic impact, US$1.84 billion (16.9%) is expected to come directly from the Malaysia West cloud region’s operations over the four-year period. The remaining US$9.16 billion will result from activities by Microsoft, its partners, and customers. This essentially models the multiplier effect that arises from business use of Microsoft’s technology, encompassing tools like M365 and cloud technologies for app development.
These economic projections are outlined in the IDC report “Microsoft Cloud Dividend Snapshot” for Malaysia, prepared by Microsoft, which underlines the significant benefits of the upcoming cloud infrastructure investment. The impact announcement for Malaysia came the same day Microsoft Indonesia revealed similar economic impact projections for its cloud region slated to open in Q2 2025.
“Different markets have different structures and how they invest as well. We are equally focused on making sure that we’re making the right investment in this region, with Malaysia being one of them,” said Si, explaining the company’s approach to the region.
Building an AI-Ready Workforce
Microsoft’s investment extends past infrastructure, as it also commits to equipping 2.5 million people across ASEAN with AI skills by 2025 aligning with the ASEAN Digital Masterplan 2025. This strategy emphasizes the need to build an inclusive, AI-ready workforce.
“We recognize that to execute such a goal, we need to work with the whole spectrum of different partners in the country, government agencies, NGOs, and academics,” Si stated.
Building upon prior digital skills initiatives in Malaysia, Microsoft launched the “AI for Malaysia’s Future” (AIForMYFuture) initiative in December 2024. The program aims to equip 800,000 Malaysians with AI skills by the end of 2025. Microsoft has already trained more than 1.53 million people in digital skills as part of its Bersama Malaysia initiative. This focus on AI training corresponds with the increased adoption of AI across the country. According to the 2024 Microsoft Work Trend Index, AI is already being utilized at work by 84% of Malaysians.
Impact on Malaysian Businesses
The Malaysia West cloud region is to assist ensure data residency, compliance with local regulations, and possibly offer improved performance for Malaysian organizations. Microsoft states that this will meet the needs of public and private sector entities seeking to accelerate digital transformation, however the actual impact will only be measurable after the facilities are operational.
“As Microsoft commits to transforming Malaysia’s cloud and AI infrastructure, the upcoming Malaysia West cloud region will enable Malaysian companies to scale their innovation in a more seamless way, while offering global businesses a gateway into Malaysia with integrated technological readiness,” Dr. Andrew Lau, Director of Strategic Programs for Microsoft Malaysia, said. “We are optimistic that the new cloud region will enhance the country’s global competitiveness in a rapidly evolving digital landscape, propelling Malaysia to be at the forefront of an AI-powered future.”
Industry analysts have pointed out that while local cloud infrastructure often reduces latency issues, organizations will still need to assess if Microsoft’s cloud offerings align with their technical requirements and cost relative to alternative solutions.
Henry Chang Jie Shen contributed to this article.
