Malaysia invests in AI & cybersecurity for digital growth

Malaysia is positioning itself as a leader in the digital economy of Southeast Asia through strategic investments in artificial intelligence (AI) and cybersecurity.

According to Georg Chmiel, Executive Chairman of Chmiel Global Advisory, Malaysia's focus on these areas is contributing significantly to its economic growth and establishing the country as a regional tech hub. The Malaysia Digital Economy Corporation forecasts that the digital economy's contribution to Malaysia's GDP will increase to 25.5% by 2025 from 22.6% in 2022. This growth trajectory is supported by investments outlined in the Malaysia Digital Economy Blueprint and Budget 2024.

In the realm of AI, Malaysia is reaping the rewards of its governmental investment of MYR 20 million under Budget 2024 into a national AI framework. This framework is aimed at driving AI research, development, and commercialisation, and it is expected to create over 500,000 high-value digital jobs by 2030. "Malaysia is at the forefront of the adoption of artificial intelligence in Southeast Asia," Chmiel states. "Artificial intelligence is transforming industries from healthcare to finance to manufacturing and creating new possibilities." Companies such as BrioHR.com and Juwai IQI are cited as examples of those leveraging AI to enhance their business models.

Chmiel underscores the significance of cybersecurity in tandem with digital growth. "With great digital growth comes great responsibility - and Malaysia is taking proactive measures to address this," he explains. The PIKOM Cybersecurity Report 2024 highlights rising cyber threats such as ransomware and phishing attacks, which Malaysia is addressing with initiatives like the MYR 50 million allocation in Budget 2025 for AI and cybersecurity research. This includes establishing the Malaysian Cryptology Technology and Management Centre through a partnership between Universiti Putra Malaysia and the National Cyber Security Agency.

"You can't have a thriving digital economy without trust," Chmiel adds. "Malaysia's focus on cybersecurity isn't just about protecting businesses and consumers - it's about building confidence in the digital space. That's a huge draw for foreign investors."

Global companies are recognising Malaysia's potential as a high-tech investment destination. For instance, Oracle's investment in a new cloud region in Malaysia demonstrates international confidence in the country's digital infrastructure and talent pool. "Malaysia has everything going for it - great infrastructure, good talent pool, and business-friendly policies," Chmiel notes.

The Budget 2025 further underscores Malaysia's commitment to digital transformation with significant allocations. These include MYR 1.5 billion for 5G rollout and broadband expansion, as well as MYR 200 million for digital literacy and AI upskilling initiatives. Tax incentives are also announced for companies investing in areas like AI and cybersecurity.

The Malaysian government's measures align with its ambition to become a high-income, digital nation by 2030. His Majesty Sultan Ibrahim of Malaysia has praised the government's initiatives to boost foreign investment in the digital and technology sectors, reinforcing Malaysia's modern and forward-looking stance.

Chmiel concludes, "Malaysia's journey toward digital transformation is truly inspiring. By embracing AI and cybersecurity, the nation is enhancing its economic competitiveness and improving quality of life. At Chmiel Global Advisory, we are proud to support this vision through our portfolio of Malaysian-headquartered companies - BrioHR.com, Xamble, Juwai IQI, and GoFlexEvents - which are leading the charge in digital innovation within their industries."