DIGITAL ECONOMY SET TO FURTHER STRENGTHEN NATIONAL COMPETITIVENESS IN WAKE OF 5.1% GDP GROWTH

KUALA LUMPUR, 17 February 2025 – The digital economy will continue to serve as a strategic engine of growth for Malaysia due to its essential role in driving innovation, enhancing productivity and fostering new business models across industries.

MDEC CEO Anuar Fariz Fadzil said that Malaysia's proactive digital policies, particularly in AI, and talent development have collectively positioned Malaysia as a regional hub for digital excellence.

“Public-private collaborations further enhance our nation's leadership in AI and quantum computing, driving transformative impacts across sectors like manufacturing, finance, and services,” said Anuar.

“MDEC is dedicated and committed to support Malaysia in achieving or surpassing the 25.5% digital economy contribution to GDP by year-end through initiatives that catalyse digital transformation, talent development and technology adoption across businesses.”

“Our goal is to enhance SME competitiveness, continue attracting high-quality investments and develop a digitally skilled workforce ready for the future.”

He highlighted foreign direct investments (FDIs) as a key driver of national growth, citing data centre investments: “Malaysia has attracted over RM86 billion in data centre investments in 2024, establishing our nation as Southeast Asia’s leading data centre hub with 77 data centres throughout the country.”

Last Friday, Bank Negara Malaysia (BNM) announced that the Malaysian economy grew by 5.1% in 2024 (2023: 3.6%), driven by a rebound in exports, strong investment approvals, and progress in multi-year public-private projects, including catalytic initiatives under the Digital Economy Blueprint and the New Industrial Master Plan 2030.

“This growth reflects the resilience and dynamism of Malaysia's economy, with the digital economy playing an increasingly significant role in driving economic recovery and future prosperity,” said Anuar.

Digital Investments played an instrumental role in contributing to the overall national GDP growth of 5.1% in 2024. Under Malaysia Digital (MD), the total approved digital investments in the 2024 was recorded at RM 163.6 billion, surpassing the approved digital investment value for 2023 by 250%. The digital investment inflow during this period were also creating more than 48,000 jobs, surpassing the 2023 total by 109%. These are tangible indicators that the digital industry continues to be a powerhouse for high-skilled, high-income employment.

Malaysia is well positioned to be the gateway into ASEAN market with top 5 FDI inflows into Malaysia coming from Singapore, United States, China, Australia and India.

With abundance of land, talent and geographical positioning of Malaysia the heart of ASEAN, driving the digital investment cluster for Malaysia are the Global Business Services (RM139bil), Information Technology (RM23bil) and Creative Content RM887mil) creating a combined total of over 48,000 high value jobs.

Major investments come into Klang Valley (RM136bil), Johor (RM22bil), Penang (RM3bil), Sabah (RM423mil) and Sarawak (RM280mil).

A strong area of focus for MDEC is the acceleration of state-level digital growth, aiming to enhance digital infrastructure, nurture AI ecosystems, and drive SME digitalisation to elevate national competitiveness.

This focused approach is aimed at empowering states to leverage their unique strengths while contributing to Malaysia’s broader digital economy objectives.

“MDEC will continue to play our part in attracting marquee AI companies to establish operations in various state throughout Malaysia,” said Anuar. “We are also actively promoting Malaysian tech champions and supporting their expansion into foreign markets for export purposes.”

Recently, Anuar led an MDEC delegation to Johor for discussions with Johor Chief Minister Datuk Onn Hafiz Ghazi and other state leaders to explore collaborative opportunities and align key initiatives.

He described Johor as “a state brimming with huge potential in the digital economy, with its strategic location and progressive policies providing a strong foundation for innovation and growth.”

“Johor has the potential to become a regional hub for data centres, fintech, and digital content, supported by the Johor-Singapore Special Economic Zone and the Iskandar Animation and Games Hub, making it well-positioned to attract international investments and create high-value job opportunities,” he said.

The MDEC team will return to Johor in the coming week to follow up on these plans, focusing on concrete actions to drive the identified initiatives forward.

“We are committed to working hand-in-hand with our state partners to translate these strategies into meaningful outcomes that benefit businesses and the rakyat across Malaysia,” Anuar concluded.

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Issued by:

Corporate Communications Division

Malaysia Digital Economy Corporation (MDEC)