Malaysia has emerged as a digital hub in Southeast Asia in recent days, driven by rising demand for artificial intelligence (AI), cloud infrastructure and data analytics.

Oracle's “regional cloud” strategy refers to a specific geographic area, home to multiple data centers, where the company provides computing and storage services.

The US cloud company said its system still delivers low latency while meeting data storage and security compliance requirements.

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Oracle is the latest cloud service provider to announce an investment in Malaysia. Photo: Fortune

Zafrul Aziz, Malaysia's Minister of Investment, Trade and Industry, said Oracle's investment will empower local businesses, especially small and medium enterprises, with the cloud and AI technologies needed to enhance their global competitiveness.

“This is also a major step towards realising the ambitious vision of the New Industrial Masterplan, which aims to create 3,000 smart factories by 2030,” Zafrul said, adding that the investment demonstrates Malaysia’s infrastructure readiness and its position as a digital investment destination in Southeast Asia.

Oracle's investment follows major commitments from other tech giants such as Amazon Web Services (AWS), Google, Microsoft and Nvidia.

AWS previously established a cloud region in Malaysia as part of a 10-year, $6.2 billion investment to drive digital growth in Asia Pacific.

The AWS region’s operations and development are expected to contribute US$12.1 billion to Malaysia’s GDP, while helping to create more than 3,500 full-time jobs annually, until 2038.

Google and Microsoft have also made similar investments in cloud regions to support Malaysia’s digital transformation goals.

Nvidia has partnered with several cloud providers, including local conglomerate YTL Corp., in a 20 billion ringgit ($4.8 billion) investment to develop an AI data center in Kulai, in the southern state of Johor.

Oracle's announcement comes shortly after Malaysia's National Cloud Policy was announced by Prime Minister Anwar Ibrahim on Tuesday (October 1).

The policy aims to drive digital transformation by increasing cloud adoption across government agencies and the private sector, positioning Malaysia as a cloud technology leader in Southeast Asia.

“The National Cloud Policy will support the growth of local businesses, enabling them to compete globally through digital innovation,” Anwar stressed, highlighting the role of cloud infrastructure in boosting the country’s digital economy.

(According to Nikkei, Yahoo Tech)

Why did Google choose Malaysia and Thailand to build data centers? Google has announced billions of dollars in investments to build data centers and cloud services in Thailand and Malaysia, respectively. What advantages do these two Southeast Asian countries have over the rest of the region?