Malaysia's digital economy driven by AI & cybersecurity

Georg Chmiel, Executive Chairman of Chmiel Global Advisory, has emphasised the importance of artificial intelligence (AI) and cybersecurity as crucial elements underpinning Malaysia's digital economic growth.

The Malaysia Digital Economy Corporation predicts that the nation's digital economy will comprise 25.5% of its GDP by 2025, an increase from 22.6% recorded in 2022. This growth is anticipated to be bolstered by investments in AI, cybersecurity, and digital infrastructure, as outlined in the Malaysia Digital Economy Blueprint and Budget 2024.

Regarding AI, Chmiel highlighted Malaysia's investment of MYR 20 million in a national AI framework as part of Budget 2024. This strategy aims to foster research, development, and commercialisation of AI technologies, potentially leading to the creation of over 500,000 digital jobs by 2030.

"Malaysia is at the forefront of the adoption of artificial intelligence in Southeast Asia," Chmiel remarked. "Artificial intelligence is transforming industries from healthcare to finance to manufacturing and creating new possibilities. Prime examples of companies that are very well-positioned to leverage this technology include BrioHR.com, which leverages artificial intelligence to automate HR practices, and Juwai IQI, which applies artificial intelligence analytics to real estate."

Chmiel also addressed Malaysia's approach to cybersecurity, pointing out the increased risks associated with digital dependence. "With great digital growth comes great responsibility—and Malaysia is taking proactive measures to address this. According to the PIKOM Cybersecurity Report 2024, the growing reliance on digital infrastructure has exposed businesses and government entities to escalating cyber threats, including ransomware, data breaches, and phishing attacks. To tackle these challenges, Malaysia is also addressing emerging quantum-related cybersecurity risks. Under Budget 2025, RM50 million has been allocated to public universities for AI and cybersecurity research. This includes a collaboration between Universiti Putra Malaysia (UPM) and the National Cyber Security Agency (NACSA) to establish the Malaysian Cryptology Technology and Management Centre, further strengthening the nation's commitment to cyber resilience."

"You can't have a thriving digital economy without trust," Chmiel states. "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."

Malaysia is positioning itself as a hub for high-tech investment, attracting substantial interest from major global firms like Oracle, which are investing billions in the nation. The company's decision to establish a cloud region in Malaysia is a marker of confidence that promises to generate numerous opportunities and drive technology uptake.

Chmiel described Malaysia's appeal for high-tech investment as due to several factors: "Malaysia has everything going for it—great infrastructure, good talent pool, and business-friendly policies," he said. "It's no wonder that Malaysia's tech sector is expected to grow by 8-10% annually by 2025, driven by investments in AI, cybersecurity, and digital infrastructure."

Further affirming the nation's positive trajectory, His Majesty Sultan Ibrahim, King of Malaysia, has praised government efforts to boost foreign investment in digital and technology sectors. The endorsement from the royal family underscores the significance of these initiatives in fostering economic development and creating quality employment.

Budget 2025 signifies Malaysia's sustained dedication to digital transformation, with a significant emphasis on infrastructure and workforce development. Allocations include MYR 1.5 billion for expanding digital infrastructure—including 5G rollout and enhanced broadband—and MYR 200 million for upskilling programmes centring on digital literacy and AI expertise, alongside tax incentives for companies investing in pertinent technologies.

The strategy aligns with Malaysia's aspirations to emerge as a high-income country underpinned by digital innovation by 2030. Through strategic investment in AI and cybersecurity, Malaysia is paving the way for a dynamic digital economy that encourages growth and inclusivity.

"Malaysia's journey toward digital transformation is truly inspiring," remarked Chmiel. "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 GoFlex Events—which are leading the charge in digital innovation within their industries."