KUALA LUMPUR: Google's US$2 billion investment in its new data centre and cloud region in Malaysia is projected to generate US$3.2 billion in gross domestic product (GDP) growth and create 26,000 highly skilled jobs over the next five years, said Minister of Investment, Trade and Industry Tengku Datuk Seri Zafrul Abdul Aziz.
Tengku Zafrul said this represents real opportunities for Malaysians to participate in and benefit from the digital economy.
"Google's data centre is clearly in alignment with Malaysia's New Industrial Master Plan 2030 (NIMP 2030).
"Under NIMP 2030, we aim to create 3,000 smart factories by 2030, driven by advanced technologies such as AI, big data, and machine learning," he said at 'Mantap Malaysia Bersama AI', a Google for Malaysia event here, yesterday.
Universiti Kuala Lumpur Business School economic analyst associate professor Aimi Zulhazmi Abdul Rashid said Google's investment in Malaysia underlined the country's growing reputation in the IT industry.
"This is not only as a major producer of semiconductors but also data centres, which is only made possible by Malaysia's strong infrastructures and support from an investors-friendly government," he told the Business Times.
Similarly, Aimi said huge movement by the multinational companies (MNCs) of the IT industry will spillover to related industries, as a beacon of growth and investment.
"The compounding economic effect will be on the real estate industry, construction to others like education, telecommunication, which will forge economic Development to Malaysia, driving more foreign direct investment (FDI) and omestic direct investment (DDI)," he said.
Economist Dr Geoffrey Williams, however, offered a cautious interpretation of the announcement.
"If the projection is accurate it would add just under 0.15 per cent to GDP in each year and eventually create 26,000 jobs in the wider economy and supply-chain but not necessarily from the data centre itself," Williams said.
Google's groundbreaking ceremony for its first US$2 billion data centre and cloud infrastructure was held yesterday in Elmina Business Park, Selangor.
With construction underway, the data centre and cloud infrastructure will help meet growing demand for Google Cloud capabilities, Al innovations, and other digital products and services that people and organisations in Malaysia use every day.
Prime Minister Datuk Seri Anwar Ibrahim was the guest of honour at Google for Malaysia, where he was hosted by Alphabet and Google president and chief investment officer Ruth Porat.
Porat said Google reaffirms its support for advancing Malaysia's digital future with the groundbreaking of its data centre and cloud region in Selangor.
She said Google's investments in infrastructure, digital skilling, and sustainability represent progress on its joint efforts with the government of Malaysia to create high-value jobs and bring the benefits of Al to local communities and companies.
"Together, we will empower individuals and businesses in Malaysia to innovate, grow, and fully harness the potential of the digital age.
"As we do this, Google will continue its responsible stewardship of natural resources by improving community watershed health and ecosystems in Malaysia and helping to drive local adoption of renewable energy sources," she said.
Google also announced a series of local digital skills and sustainability partnerships that build on the strategic collaboration it established with the government at the Asia Pacific Economic Cooperation (APEC) Leaders' Meeting in November 2023.