Malaysia data center investment resilient despite geopolitical risks: research

KUALA LUMPUR, April 28 (Xinhua) -- Investment appetite for data centers in Malaysia remains robust despite geopolitical tensions and energy market volatility, supported by strong demand from hyperscalers and colocation providers, RHB Investment Bank said Tuesday.

The research house said in a report that industry checks point to sustained demand with minimal changes to planned investment, as artificial intelligence (AI)-related workloads continue to drive expansion.

"Strong demand for AI-related workloads remains the key structural tailwind, mitigating supply chain concerns and potentially higher build-out costs," it said.

RHB noted that rising security concerns and supply chain risks in the Middle East could prompt a rebalancing of global data center portfolios in Southeast Asia, with Malaysia a key beneficiary due to its cost competitiveness, political stability and supportive policies.

Despite higher energy costs, data center economics in Malaysia remain favorable. More than 3GW of capacity is expected by 2030, translating into about 90 billion ringgit (about 22.79 billion U.S. dollars) in construction value. Enditem