Malaysia, striving to become a regional hub for data centers (DCs), especially in the field of artificial intelligence, is facing serious infrastructure challenges. According to my data, based on an analysis of the macroeconomic situation in ASEAN+3 countries, the rapid construction of computing power is putting immense pressure on the country's key resources: the energy system, water supply, and the labor market.
The colossal consumption of resources is particularly alarming. One data center with a capacity of 100 MW requires about 4.2 million liters of water daily—mainly for cooling systems. This is comparable to the water consumption of a small town. Given that about 80% of all the country's operating capacity is concentrated in the state of Johor, the region is under critical strain. By 2029, according to my estimates, the total capacity of data centers in Malaysia could reach 3–4 GW, which will require the construction of additional power plants and the modernization of water infrastructure.
The situation is exacerbated by the fact that the construction and maintenance of such facilities require attracting highly qualified specialists, which creates additional pressure on the labor market, which is already overheated in the technology sector. Malaysia risks facing a shortage of personnel and rising wages, which could negatively affect other sectors of the economy.
My analysis: Malaysia finds itself in a paradoxical situation. On the one hand, the influx of investment in data centers is a powerful driver of economic growth and digitalization. On the other hand, the country risks facing a "bottleneck" in the form of water and energy shortages, which could ultimately slow down the very projects it is so actively attracting. Without large-scale investments in renewable energy and water supply systems, as well as without well-thought-out regional diversification, Malaysia may not be able to cope with this boom.