Google commits additional US$15b to Malaysia data centre expansion over two years, projects 37,000 jobs as Anwar hails investment

Google has announced a $15 billion investment in Malaysia over the next two years to build data centers and other infrastructure, driven by the nation's growing demand for artificial intelligence services. This investment, which follows a $2 billion commitment made in 2024, aims to expand Malaysia's position as Southeast Asia's fastest-growing hub for new data centers, which are essential for training and running AI tools like chatbots and image generators.

Malaysia is currently home to over half of the under-construction data center capacity in Southeast Asia, alongside Indonesia, Thailand, the Philippines, and Vietnam. The country boasts a highly dynamic digital economy, with a 99% internet penetration rate and rapid AI adoption across various sectors, including government agencies, businesses, and consumers.

However, the proliferation of AI data centers raises concerns over their environmental impact, as these facilities are energy-intensive and often rely on fossil fuels for power and water for cooling. As a result, Google has pledged to make its Malaysian data center campuses energy-efficient and work to bolster local water security while adding more than one gigawatt of clean energy capacity to the national grid.

The project is expected to create more than 9,000 local jobs per year, with wages averaging 45% above the national median. Malaysia's economy is projected to grow by 5.2% in 2026, with data centers contributing to this growth. However, by 2035, data centers are forecast to consume one-third of the country's total energy consumption, prompting the government to ensure sufficient energy and water supply capacity before approving new projects.

In October, a Finnish authority halted work on two of Google's data center sites in the country until mandatory environmental impact assessments are completed.