Malaysia To Reap Economic Benefits From Sovereign AI Cloud Development – IT Specialist

By Mikhail Raj Abdullah

KUALA LUMPUR, Oct 14 (Bernama) -- The RM2 billion investment to develop the Sovereign AI Cloud in Budget 2026 will enable Malaysia to reap economic benefits, as it allows the country to retain the value created through artificial intelligence (AI) by keeping revenues, jobs and intellectual property within its national borders, an information technology (IT) specialist said today.

“Sovereign AI Cloud will allow us to ensure all data handling complies with local jurisdiction and the data stays within Malaysia's borders,” Erobern Consultancy founder S. Sarkunarajah told Bernama.

Besides the gains from the economic perspective, it would create opportunities for the growing number of local AI players including small and medium enterprises (SMEs) involved in digital operations, he said.

“While it is not unique to Malaysia, many governments require data generated within their borders to stay there,” he said in response to Prime Minister Datuk Seri Anwar Ibrahim’s announcement last Friday that the Malaysian Communications and Multimedia Commission (MCMC) would develop the Sovereign AI Cloud.

Anwar, who is also Finance Minister, had said that the future of Malaysia’s digital economy was dependent on data sovereignity and AI as part of efforts to making Malaysia a regional cloud and digital hub by 2030 as outlined in the government’s MyDigital Blueprint.

Sarkunarajah, who has over 20 years of experience in the IT Industry with a focus currently on operational excellence, said Sovereign AI Cloud by definition means “cloud computing infrastructure specifically designed for AI workloads, where the Malaysian government maintains complete control over our AI capabilities, data and  infrastructure within our own legal jurisdiction.”

“While we will have to depend on external parties like (American chipmaker) NVIDIA and others, focusing on building our own Sovereign AI Cloud, will allow us to ensure all data handling complies with local jurisdiction and the data stays within Malaysia's borders.

“We are seeing a growing number of local AI players in Malaysia and creating something like this (Sovereign AI Cloud) will create opportunities for local players in the industry,” he said.

In the process, he added, it would create an ecosystem of local companies focusing on research and development, commercialisation and innovation within the AI space as well as cloud infrastructure.

Despite the clear advantages, Sarkunarajah said Malaysia must overcome several challenges, foremost of which is talent shortage, which requires a constant focus.

“Funding for start-ups is another area that is key to support SMEs to scale and we as a nation must also increase our AI literacy across the workforce and general population.

“They must use AI to increase productivity and at the same time be aware of cybersecurity risks due to usage of AI by malicious actors,” he said in obvious reference to hackers and scammers.

An ecosystem of AI players, especially in the SME sector, not only supports the nation’s efforts in building the Sovereign AI Cloud but also addresses some of the challenges Malaysia faces in achieving its AI vision, Sarkunarajah added.

-- BERNAMA