Malaysia's data centres unlikely affected by Nvidia chips uproar
KUALA LUMPUR: Malaysia's fast-growing data centre industry remains on track despite reports that Chinese firms may be using servers with Nvidia chips in the country to train AI models, MIDF Research said.
The firm said the chips are likely older versions, and not the latest GB200 chips restricted by the US for export to China.
It added that data centre projects are continuing without delay, with contractors still actively bidding.
Recent developments include Gamuda selling land in Port Dickson, Negri Sembilan to Google-linked Pearl Computing and winning a RM1.01 billion contract for data centre works.
Sunway Construction secured a RM1.16 billion job from a US tech firm, while Microsoft reaffirmed a RM10.5 billion investment in artificial intelligence (AI) and cloud infrastructure in the Klang Valley.
MIDF Research pointed out that not all data centres in Malaysia are built for AI, although many are AI-ready.
For instance, YTL Power allocated only 100 megawatt (MW) for AI use at its 500MW facility in Kulai, Johor.
Investment, Trade and Industry Ministry is looking into claims that a Chinese firm is using Nvidia-powered servers in Malaysia to bypass US chip export restrictions, as reported by the Wall Street Journal.
The ministry said the servers involved are not classified as controlled items under Malaysia's Strategic Trade Act 2010, and local data centres are free to operate if they comply with local laws.
However, it stressed that any attempts to circumvent trade controls or engage in illegal activities will not be tolerated.
The ministry also reaffirmed Malaysia's adherence to global trade rules and urged companies to comply with export controls in international dealings to avoid secondary sanctions.
Amid rising US-China tech tensions, Malaysia aims to remain neutral but is still pushing ahead with plans to become a key AI hub in Southeast Asia, as outlined by Prime Minister Datuk Seri Anwar Ibrahim.
AI development depends heavily on powerful chips and large-scale data centres.
Malaysia's data centre market is expected to grow from US$4.04 billion (RM17.2 billion) in 2024 to US$13.57 billion (RM57.8 billion) by 2030, according to the Malaysian Investment Development Authority.
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