Malaysia’s Digital Economy to Exceed 25.5% Contribution to the National GDP by End of 2025
The National Madani Budget 2025, themed “Reinvigorating The Economy, Driving Reforms, and Prospering The Rakyat,” is being hailed as a pivotal step towards reinforcing Malaysia’s digital economy.
The budget positions Malaysia to lead in key areas such as artificial intelligence (AI), cloud infrastructure, and digital innovation, all while bolstering the nation’s readiness for its ASEAN 2025 chairmanship.
Malaysia Digital Economy Corporation (MDEC) Chief Executive Officer Anuar Fariz Fadzil sees the budget as a key driver in advancing digitalisation and fostering inclusive growth.
A Strategic Leap Towards ASEAN 2025
According to Anuar Fariz, the Madani Budget 2025 lays the foundation for Malaysia’s continued digital leadership within ASEAN.
As the nation gears up to chair ASEAN in 2025, initiatives in the budget are crafted to enhance Malaysia’s status as a digital hub.
The budget includes incentives for both local and foreign investors to participate in high-value digital services.
“Our digital economy is set to exceed a 25.5% contribution to the national GDP by the end of 2025,” noted Fariz, echoing the sentiment expressed by Digital Minister Gobind Singh Deo.
These efforts not only elevate Malaysia’s position but also create job opportunities while narrowing the socio-economic gap through digital transformation.
Attracting Global Tech Giants
One of the standout achievements of Budget 2025 is the attraction of US$16.9 billion in investments from tech giants like AWS, Microsoft, and Google, reinforcing Malaysia’s role as a regional gateway for cloud infrastructure.
The collaboration between ministries and agencies such as MDEC played a critical role in securing these investments.
This not only underscores Malaysia’s significance in the global digital economy but also promises a slew of job opportunities and upskilling initiatives, including new centres of excellence.
Advancing AI and Digital Trust
Malaysia’s push toward AI leadership received a boost with RM10 million allocated to the National AI Office and RM50 million earmarked for AI education.
“These efforts ensure Malaysia leads the region in AI innovation, while also prioritising ethical development,” said Fariz.
MDEC’s commitment to ethical AI practices shines through its leadership in establishing the ASEAN AI Safe Network.
In tandem, the introduction of the Digital ID initiative marks another step forward, providing secure identity verification for online transactions, reducing fraud, and enhancing digital trust.
This initiative is expected to play a significant role in Malaysia’s broader digital transformation efforts.
Empowering SMEs and Nurturing Innovation
Small and medium enterprises (SMEs) are poised to benefit immensely from the Madani Budget, with strategic initiatives to drive digital adoption and operational efficiency.
The RM1 billion National Fund-of-Funds and RM1 billion Pioneer Fund are specifically aimed at bolstering Malaysia’s startup ecosystem.
MDEC’s Founders Centre of Excellence, which nurtures local startups with critical resources, has already shown success stories, such as Vitrox Bhd.
Founded by two engineers from Universiti Sains Malaysia, Vitrox has become a global player, serving markets across Asia, Europe, and the US.
MDEC is committed to nurturing a culture of innovation that empowers startups and strengthens Malaysia’s position in the ASEAN region.
Budget 2025 is not just about immediate economic gains but a long-term vision for Malaysia’s digital future.
MDEC, in close collaboration with the government, is committed to supporting the nation’s digital transformation, creating opportunities for businesses and citizens alike, and positioning Malaysia as a leader in the region’s digital economy.
With the right foundation in place, Malaysia is ready to embrace its role as a digital leader in ASEAN 2025 and beyond.
