SD Guthrie Bhd is in a favourable position to ramp up its future renewable energy (RE) business, partly thanks to the recently launched Kerian Integrated Green Industrial Park (Kigip) master plan in Perak.

Maybank Investment Bank Research said besides Kigip, Penang could also be a potential buyer of RE from SD Guthrie’s solar farm at Kigip to offset carbon dioxide generated at its Silicon Island project.

“While the master plan has been launched, it is still unclear what SD Guthrie’s final equity structure in Kigip will be. What we know is Kigip will provide SD Guthrie with land disposal gains (when it opens up in stages) while its solar farm (likely 100% owned) will provide future recurring income.

“The project could house 157MW to 178MW of solar capacity, and form part of the company’s ambition to grow its RE capacity to 1,000MW in the next three to five years,” the research house added.

Kigip borders the states of Penang and Kedah. The master plan would be developed through the collaboration of the federal government, Perak state government, SD Guthrie, and Permodalan Nasional Bhd.

Solar will be Kigip’s main source of power, and the project aims to attracting high quality investments especially in sectors such as electrical and electronics.

This 1,000-acre Kigip site, to be developed in stages, would be supported by SD Guthrie’s 660 acre solar farm that would be built adjacent to the site.

Besides Kigip, there are other opportunities and potential projects in line with federal and state governments’ initiatives.

The brokerage said its earnings forecasts have yet to incorporate contributions from Kigip or large scale solar farms, noting that it is maintaining its “buy” call on the stock with a target price of RM4.96 per share.

Source: The Star

Potential for SD Guthrie to ramp up its RE business

Telekom Malaysia Bhd (TM) is partnering Nxera, the regional data centre arm of Singapore’s Singtel’s Digital InfraCo unit, to develop data centres in Malaysia starting with a sustainable, hyper-connected artificial intelligence (AI)-ready data centre campus in Johor.

The data centre campus in Iskandar Puteri – 16 kilometres from Singapore – would be the largest to date for both TM and Nxera.

The initial phase of the data centre is planned for 64 megawatts (MW) and could be scaled up to 200MW in response to market demand, the telecommunications service providers (telcos) said in a statement today.

According to the statement, the strategic partnership aims to serve the needs of hyperscalers, next-generation AI application providers, and enterprises pursuing accelerated digitalisation and cloud in the region.

“This high-power density campus will be able to host large computing and AI capabilities such as requirements by cloud hyperscalers, graphics processing units (GPU)-as-a-service providers and features advanced technologies such as liquid cooling to support high-power density workloads and operations efficiently.

“The data centre will be a Leadership in Energy and Environmental Design (LEED)-certified green building, emphasising its commitment to greater energy efficiency and sustainable practices,” it said.

TM group chief executive officer (CEO) Amar Huzaimi Md Deris said the collaboration of two main telcos in the region is unique and has a positive impact on the development of a digital ecosystem that not only benefits businesses but also nurtures future talent.

“Establishing a hyperconnected AI-ready data centre marks the next phase in our long-standing partnership with Singtel, leveraging our strengths and commitment to elevate ASEAN as the preferred digital hub destination.

“TM brings the largest domestic network infrastructure, extensive international subsea cable systems, and the largest interconnected data centre in Malaysia, a solid backbone for this project,” he said.

Amar Huzaimi noted that the data centre would catalyse high-performance computing and lay a solid foundation for the future advancement of cloud and AI applications.

He also said that through the partnership, TM continues to demonstrate its dedication to delivering innovative and sustainable solutions, marking a pivotal step in its aspiration to become a digital powerhouse by 2030.

Meanwhile, CEO of Nxera and Singtel’s Digital InfraCo unit Bill Chang said the collaboration advances its vision to be the region’s leading sustainable, hyperconnected AI-ready data centre platform, supporting businesses with the digital infrastructure needed for the growing demand for cloud, digitalisation and AI.

“The first data centre campus development in Johor, which can be expanded in phases, demonstrates our ability to scale quickly in markets that are important to our customers.

“With our joint industry expertise and strong track record, we will build and operate one of the most efficient, sustainable and connectivity-rich data centres in Malaysia,” he said.

In addition to data centres, Chang said the company would be expanding the submarine cable connectivity between Singapore and Johor to enhance digital connectivity.

He said the joint venture would also partner with institutes of higher learning in Malaysia to nurture talent for projects and the industry.

Source: Bernama

TM, Singtel’s Nxera form joint venture to develop next-gen data centres

Investments from technology companies in Malaysia will definitely improve and enhance the artificial intelligence (AI) ecosystem in the country, said Minister of Science, Technology and Innovation (Mosti) Chang Lih Kang.

He said this in response to questions from reporters regarding TikTok owner ByteDance’s plan to invest RM10 billion in Malaysia.

“When technology companies invest in Malaysia to expand their operations, they will help us enhance the AI ecosystem.

“This means more computing power and more data centres. I believe this will help us build infrastructure and encourage the adoption of AI,” he told reporters after officiating at the National Science Week Carnival 2024, today.

Regarding Nvidia’s investment, Chang mentioned how the government could utilise its investment in terms of technology and expertise.

“Nvidia is investing with Malaysian partners. We foresee a transfer of technology, which will help us in terms of infrastructure. They will establish data centres using GPUs (graphics processing units) with high computing power. This will help us push AI development in our country,” he said.

Additionally, he said Mosti, through the Malaysian Research Accelerator for Technology and Innovation (MRANTI), has established an AI sandbox in collaboration with Nvidia to benefit from its expertise.

“Nvidia has also discussed and agreed to provide cloud credits to Malaysia for AI start-ups in our country,” he added.

Source: Bernama

Tech giants’ investments to boost Malaysia’s AI ecosystem, says science minister

TH Plantations Bhd has partnered with Cenergi SEA Bhd to undertake the development, construction and operations of a 1.2 megawatts (MW) biogas power plant in Kluang, Johor.

The project will be executed through a joint venture between THP Applications & Services Sdn Bhd and Cenergi RE Sdn Bhd.

TH Plantations chief executive officer (CEO) Mohamed Zainurin Mohamed Zain said the biogas power plant is targeted to be operational in 2026.

Once operational, he said the electricity generated from this biogas power plant will be sold to the national grid managed by Tenaga Nasional Bhd (TNB) under the SEDA’s (Sustainable Energy Development Authority) Fit Scheme.

“At TH Plantations, we are always looking for ways to enhance Tabung Haji’s investment value while prioritizing environmental sustainability,” he said at the signing ceremony here, today.

The biogas power plant is set to generate enough electricity to power up to 1,500 homes annually.

In term of environmental impact, this biogas power plant could help avoid about 20,000 tons of carbonemissions annually, which is equivalent to 4,760 cars driven in a year.

Mohamed Zainurin said the project aligns with TH Plantation’s Al-Falah 22/22 strategies, aimed at optimising the treatment of palm oil mill effluent and reducinggreenhouse gas emissions.

He said the introduction of green technology initiatives will enhance the existing factory treatment system without causing environmental harm.

“Renewable Energy (RE) is poised to play an increasingly significant role in Malaysia’s electricity generation, given the abundance of biomass and biogas resources. TH Plantation is committed to exploring opportunities to become a reliable supplier of bio-stock for the RE industry,” he said.

Meanwhile, Cenergi group CEO Hairol Azizi Tajudin said through this partnership, the company will offer its expertise and services to support TH Plantations with its sustainability journey, particularly in reducing carbon emissions.

“As part of our strategic collaboration with TH Plantations, we should collaborate more not only on biogas but in other areas such as biomass pellets and solar.We are also open to explore other areas of RE technology with TH Plantations should the opportunity arise, and the time is right,” added Hairol.

Source: NST

TH Plantations to work with Cenergi SEA for 1.2MW biogas power plant in Kluang, Johor

WITH the implementation of the China Plus One strategy, expansion of third-party logistics (3PLs) and space upgrades, along with growth in sectors such as electrical and electronics (E&E), pharmaceuticals and medical devices, cold chain logistics and automotive, the demand for industrial warehouses has surged.

PTT Synergy Group Bhd (KL:PTT), a construction company that also provides warehouse solutions and distribution centres, is planning to distinguish itself from other players in the logistics space by transforming into a high-tech total intralogistics and industrial solutions provider.

Its founder, joint controlling shareholder and managing director Teo Swee Phin says demand for warehouse space remains high, with manufacturers being the main drivers as they expand their logistics space.

“We wish to transition to a company with sustainable earnings for our stakeholders and become an ‘A’ Class industry leader in high-technology industrial solutions, not just locally but also regionally,” he tells The Edge in an interview.

PTT has three main business segments: (i) construction; (ii) industrial property development and warehouse and logistics; and (iii) trading of building materials.

The group specialises in developing built-to-suit automated industrial warehouses featuring Automated Storage and Retrieval System (ASRS) technology, which consists of a variety of computer-controlled systems for automatically placing and retrieving loads from defined storage locations.

“As a construction company specialising in earthworks and infrastructure works, we leverage our expertise to enhance the cost efficiency of our industrial warehouse development projects,” says Teo.

PTT staged a turnaround with an annual profit of RM8.41 million in the financial year ended June 30, 2022 (FY2022), from a net loss of RM1.09 million in FY2021. However, its bottom line declined by a sharp 81% to RM1.59 million in FY2023. In the nine months ended March 31, 2024 (9MFY2024), the group reported a net profit of RM7.68 million,which is 16.68% lower than a year ago.

Teo says the significant drop in PTT’s earnings in FY2023 was primarily due to the accretion of interest on deferred trade payables of RM3 million — associated with the group’s industrial development projects — and a one-off corporate exercise cost for the acquisition of Pembinaan Tetap Teguh Sdn Bhd (PTTSB).

“Looking ahead, we anticipate a positive revenue and profit growth over the next three to five years, driven by enhanced operational efficiencies and the maturity of our ongoing industrial property developments,” he says.

In FY2023, PTT’s construction division remained the group’s largest revenue contributor, accounting for 70% of its turnover. The trading division accounted for 29% of its total revenue, while the industrial property development and warehouse and logistics division contributed 1%.

“We expect our construction division to continue to be the main driver for our core earnings in the short term. In 9MFY2024, the construction division accounted for 82% and the trading division 18% of total revenue.

“We expect construction to contribute 70% to FY2024 total revenue; with 15% from industrial property development and warehouse and logistics; and another 15% from the trading division,” Teo estimates.

On the construction front, PTT clinched a RM299 million contract in March to build a bridge and connecting roadworks from Tumpat to Kota Bharu, Kelantan, before it went on to secure two earthworks contracts from Sime Darby Property Bhd (KL:SIMEPROP) totalling RM169.8 million in May. On average, gross margins for the group’s construction division are between 15% and 20%.

For FY2025 to FY2027, PTT expects its industrial property development, warehouse and logistics segment to grow as there are more industrial property projects featuring advanced technology in the pipeline, supported by increasing demand for efficient supply chain solutions and warehouse spaces.

“We remain highly focused on industrial development projects as they are a core part of the group’s businesses. Our strategic pivot and investment in these areas are in line with government initiatives to promote advanced technologies and automation in order to reduce reliance on labour,” says Teo.

Apart from the ongoing Tropicana Industrial Park in Johor, PTT has five more industrial property development projects in the pipeline, consisting of smart warehouses equipped with ASRS technology and other automated solutions, with a monthly capacity of 237,000 pallets, over the next two years, which could accelerate the group’s earnings in the coming years.

System pallet serves as the structural foundation for the efficient handling and storage of unit load systems. Tenants for these projects are diversified across growing sectors in the 3PLs providers, fast-moving consumer goods (FMCG), semiconductor, E&E and commodity space.

In March, the group held a groundbreaking ceremony to launch its first smart warehouse development in PTT Logistics Hub 1 at Sime Darby Property’s Elmina Business Park, Shah Alam, Selangor. With an estimated gross development value of RM145 million, the project is expected to be completed in the fourth quarter of next year.

On May 23, PTT announced it had entered into a non-binding letter of intent with a prominent multinational corporation (MNC) based in the northern region of Peninsular Malaysia that specialises in semiconductors.

Under this agreement, PTT will develop a built-to-suit automated warehouse equipped with comprehensive Internet of Things and artificial intelligence technology and lease it to the MNC in Penang. This state-of-the-art infrastructure, encompassing a built-up area of 401,701 sq ft, will feature an ASRS with an annual capacity of 552,000 pallets.

Change of ownership in 2020

PTT, previously known as Grand Hoover Bhd, saw a change of ownership in 2020/21.

Aim Tetap Teguh Group Sdn Bhd (ATTG) — jointly owned by Teo, his elder brother Teo Swee Leng (PTT deputy chairman) and Datuk Abd Rahim Jaafar (PTT executive chairman) — surfaced as a substantial shareholder of the company with a 17.07% stake in October 2020.

Following a rights issue, which raised RM30 million in September 2021, ATTG became the controlling shareholder of PTT with a 57.91% stake.

As at Oct 2 last year, the trio’s private vehicle owned 55.96% equity interest in the company. At the same time, the Teo brothers collectively owned direct stakes of 18.08%.

PTT’s top 30 largest shareholders include Fortress Capital Asset Management (M) Sdn Bhd and Tradeview Capital Sdn Bhd.

Teo says PTT’s management team has been “continuously laying strong fundamentals” since the new major shareholders took over the company in 2021.

“We position ourselves differently from other Bursa Malaysia-listed stocks, as a unique total intralogistics solutions provider specialising in developing industrial warehouses featuring ASRS technology.

“Coupled with our strategic growth initiatives, we are optimistic that if the company continues to demonstrate strong financials, growth potential or strategic initiatives, it could support further appreciation in stock price,” he says.

Shares gaining traction

Over the past month, shares of the Main Market-listed PTT jumped 77.24% to close at RM2.18 last Thursday, giving it a market capitalisation of RM436.9 million.

“From the perspective of market trends, if there is rising interest in construction and property stocks on Bursa Malaysia, it could positively impact PTT’s stock price, especially if investors perceive it as belonging to a similar sector or benefiting from similar market dynamics,” Teo says.

As at end-March, PTT’s net debt stood at RM319.8 million, with net gearing at 1.76 times.

Teo acknowledges that PTT’s increased borrowings over the past years were due to “strategic borrowing aimed at accelerating the development” of the group’s key projects, as well as the acquisition of PTTSB in August 2023.

“We are vigilant about our leverage and are considering optimising our debt profile through ongoing private placement and land disposal exercises when the time is ripe,” he says.

In March 2023, the group completed a private placement and raised RM9.63 million cash by issuing nine million new shares at RM1.07 apiece.

In August that same year, PTT acquired the entire equity interest in PTTSB for RM152 million. The acquisition was deemed a related-party acquisition given the substantial ownership and directorial overlap between PTT and PTTSB.

Later in October, PTT proposed a private placement of up to 36 million new shares, representing 20% of its share base. The issue price for the third tranche of the placement shares was fixed at RM1.11 each.

PTT said the acquisition was to consolidate the private construction business and construction-related assets of major shareholders into the group. The move effectively eliminated the potential conflict of interest between the group and its major shareholders while aligning the interests of the group and PTTSB in future construction projects. 

Source: The Edge Malaysia

PTT Synergy aims to be a high-tech industrial solutions provider

TIONG Nam Logistics Holdings Bhd (KL:TNLOGIS) is confident that the group’s financial situation will improve over the next two quarters as warehouse rental rates in Johor and Kulim hit all-time highs, owing to higher demand for logistics services.

At the same time, the group’s investments in new warehouses, especially the one in Senai Airport City near the Senai International Airport in Johor, have matured and are providing steady returns to Tiong Nam.

TIONG Nam Logistics Holdings Bhd (KL:TNLOGIS) is confident that the group’s financial situation will improve over the next two quarters as warehouse rental rates in Johor and Kulim hit all-time highs, owing to higher demand for logistics services.

At the same time, the group’s investments in new warehouses, especially the one in Senai Airport City near the Senai International Airport in Johor, have matured and are providing steady returns to Tiong Nam.

“We foresee in the next quarter and the quarter to come that things should get better because we have come to a point where we can leverage the new warehouses [for growth],” says Tiong Nam deputy managing director Victor Ong.

Victor, 43, is the son of Ong Yoong Nyock, founder and largest shareholder of Tiong Nam, with a 53.4% stake.

“Warehouse prices now are at a high, I would say, even in Shah Alam and especially in Kulim. Johor is very good now because of the RTS (Johor-Singapore Rapid Transit System) and property prices.

“In terms of warehousing, we are at a high level [of rental rates across the country],” Victor tells The Edge in a recent interview at the group’s headquarters in Johor Bahru.

The Senai Airport City warehouse — a 1.1 million sq ft mega-warehouse facility — was built at a cost of RM200 million. It is the largest warehouse in Tiong Nam’s portfolio and is leased to Mercedes-Benz for its regional parts logistics.

The warehouse was completed and handed over to Mercedes-Benz in August 2023 and the lease started in November 2023.

According to Victor, warehouse rental rates in Johor Bahru have been rising from roughly RM1.40 psf before the pandemic to between RM1.80 psf and RM2.00 psf currently. Meanwhile, the rates are higher in the ports; Johor’s major ports are Johor Port and Port of Tanjung Pelepas (PTP).

Meanwhile, warehouse rental rates in Kulim shot up from around RM1.20 psf prior to the pandemic to between RM2.50 and RM2.80 psf currently, owing to a severe shortage of warehousing space, says Victor.

Owning warehouses could prove to be a boon for Tiong Nam today, but the group has taken on a lot of debt to build its portfolio. The company operates 96 warehouses and distribution centres across Malaysia, Thailand, Singapore and Laos, with a total warehousing capacity of 7.7 million sq ft as at March 31, 2024.

Tiong Nam had incurred additional costs while the Senai Airport City warehouse was being built due to rising interest rates on the loans taken to build it as well as manpower getting expensive.

“The higher interest rate had cost us an increase of more than RM10 million in finance costs [compared with when interest rates were low during the pandemic],” says Victor.

Indeed, Tiong Nam’s finance costs in the financial year ended March 31, 2024 (FY2024) jumped 44.9% year on year to RM67.45 million from RM46.55 million. Its long-term debts increased by 27.5% y-o-y to RM1.174 billion from RM920.85 million and its short-term debts rose by 6.87% y-o-y to RM400.39 million.

Repayment of term loans increased by 77.17% y-o-y to RM65.59 million from RM37.02 million. At the same time, the group’s bread-and-butter integrated logistics business suffered from razor-thin margins.

For FY2024, Tiong Nam reported a net profit of RM56.97 million, compared with RM28.07 million in the corresponding period. The surge was due to an RM75.47 million fair value gain on several warehousing assets in Johor, including the Senai Airport City mega warehouse.

Stripping the one-off revaluation gain, the logistics and warehousing segment made a pre-tax loss of RM5.94 million in FY2024.

According to Victor, high borrowings should not be an issue for the group, as they are used to grow the business.

“We cannot miss the moment,” he says, when asked about the group’s rather aggres­sive warehouse building plan and land banking, fuelled by both long- and short-term borrowings.

“We have a bit of an advantage in logistics now because we purchased [warehouses] all the time in the past; so, it can have a direct influence on our pricing. If you rent, the impact [on Tiong Nam’s profitability] would be even bigger [than the impact from the holding costs].

“At least for now, we own most of our properties so that we can have better control over our pricing and become competitive. That’s why we cannot wait; when we have money, we will reinvest in the business.”

Tiong Nam has been investing, betting big on the demand for warehouses in Malaysia, especially in its home state of Johor, where it is building a warehouse on a 9.99-acre site in the PTP with a total built-up area of 820,148.08 sq ft.

In Kedah, Tiong Nam is building a warehouse with a total built-up area of 211,383.85 sq ft on a 10.82-acre tract in Mukim Padang China, Kulim, and a 121,722.58 sq ft warehouse on a 14.73-acre site in Bandar Kulim.

The PTP facility is expected to be completed in September and the Mukim Padang China warehouse is expected to be completed soon. The construction of the Bandar Kulim facility began in March and is expected to be completed within 14 months.

Tiong Nam is also developing a five-storey warehouse in the Sembawang Planning Area in Singapore. The warehouse will have a total built-up area of 228,767.27 sq ft on a 2.47-acre site and is expected to be completed by October.

Victor says the term loans are backed by the rental rates of the warehouses, and now that the Senai Airport City mega warehouse has been completed and is generating revenue for Tiong Nam, the loans are safe.

“All our borrowings are for reinvestment into the business; we use them to grow our business,” he says, adding that while Tiong Nam is operating at a tight margin at the moment, over time, the value of its properties will go up, while the outstanding loan will be reduced.

Tiong Nam managed to maintain its interest coverage ratio above 1.3 times in the last five years, even though finance costs spiked to RM67.45 million in FY2024 from RM47.21 million in FY2020.

In FY2024, however, Tiong Nam’s Ebit (earnings before interest and taxes) was inflated by the revaluation gain to RM141.11 million. Stripping the one-off gain, Ebit would have been RM107.07 million, a level at which Tiong Nam’s interest coverage ratio stood at 1.59 times in FY2024, which is higher than its historical level. This means the company has been able to manage its debts and finance costs over the last five years.

Victor says: “Logistics is a business where you need time — I would say eight to 10 years — to recover your investments … Of course, [we have short-term loans], as we need to roll the business, but why are banks willing to give us long-term loans? Because they know the nature of our business. So, our loan range will not be less than 20 years, sometimes even 30 to 35 years.”

As the group has amassed huge long-term debts, the question of whether it will be spinning off its assets into a real estate investment trust (REIT) has come up again. Talk of Tiong Nam’s undertaking such an exercise had been reported as recently as 2015.

Victor says while the group continues to look at REITs as a possible venture, it has other ways to pare down debts, if needed.

Tiong Nam’s share price has risen nine sen, or 11.43% year-to-date, closing at 78 sen on May 30, valuing the group at RM401 million and 7.12 times its trailing 12-month earnings per share.

Its closest competitor, Swift Haulage Bhd (KL: SWIFT), saw its share price rise 7.14% year-to-date to 57.5 sen, valuing the group at RM507.7 million, with a trailing 12-month price-earnings ratio of 6.79 times. 

Source: The Edge Malaysia

Tiong Nam confident of better times ahead as warehouse rental rates soar

Singapore Telecommunications Ltd, commonly known as Singtel, is believed to be the latest international company to be setting up a data centre in Johor, Malaysia.

Singapore-listed Singtel, via its regional data centre business Nxera, is said to be in talks with Malaysian authorities to set up a data centre in Iskandar Puteri in the southern state, sources told The Edge.

According to its website, Nxera currently operates two data centres in its home country of Singapore, namely DC West and Kim Chuan 2. Another data centre, DC Tuas, is currently under construction and is expected to be operational in 2025.

Besides that, Nxera is also currently constructing a data centre in Thailand, and another one in Indonesia.

Interestingly, property developer UEM Sunrise Bhd (KL:UEMS) said on Tuesday that it is selling land for RM144.9 million cash for the development of a data centre in Johor.

Coincidentally, the two parcels of freehold land measuring about 11.7 hectares (28.9 acres) are also located in Iskandar Puteri.

UEM Sunrise did not disclose the identity of the buyer, merely referring to it as “a leading global data centre industry player”.

Notably, Malaysia has taken a somewhat liberal approach in welcoming companies from around the world to set up data centres in the country to boost its ambition to become a regional data centre hub.

From 2021 to 2023, Malaysia approved RM114.7 billion worth of investments in data centres and cloud services, creating 2,325 high-value jobs in specialised fields such as data scientists, data analysts, data engineers, cybersecurity analysts, and network engineers, according to Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz.

The minister announced on Tuesday that his ministry is developing special incentives for AI data centres, as part of the government’s show of commitment to accelerate the nation’s digital transformation agenda across all sectors, while also facilitating the transition to a high-income economy.

Last month, Google announced that it has committed to investing US$2 billion (RM9.43 billion) in Malaysia to develop its first data centre and Google Cloud region in the country, which will be located in Sime Darby Property Bhd’s (KL:SIMEPROP) Elmina Business Park in Selangor.

Earlier in May, Microsoft Corp unveiled its plan to invest US$2.2 billion (RM10.38 billion) over the next four years in cloud and AI infrastructure in Malaysia.

Bridge Data Centres, a firm backed by Chinese tech firm ByteDance, had also in February announced its expansion to Cyberjaya with the development of its third data centre, MY02.

Meanwhile, China-based GDS Holdings had in March announced that it has already invested RM14.33 billion in Johor with the opening of two data centres in Nusajaya Tech Park and Kempas Tech Park.

Back in 2023, Amazon Web Services said it planned to invest US$6 billion (RM28.16 billion) in Malaysia by 2037 to strengthen its cloud services infrastructure in the country.

In the same year, YTL Power International Bhd (KL:YTLPOWR) confirmed that it is collaborating with Nvidia Corp to build an AI infrastructure that will be powered by the US-based chip giant’s technology, with the first phase of the data centre expected to commence operations by the middle of this year.

Source: The Edge Malaysia

Singtel in talks to build data centre in Johor — sources

Malaysia should seek alternative energy sources to replace diesel in light of the subsidy rationalisation exercise, says Sarawak Premier Tan Sri Abang Johari Openg.

He said Sarawak is now actively exploring hydrogen as a renewable energy, including reducing its production cost.

“Find an alternative to diesel, then you don’t need any subsidy.“Why should we be talking about diesel when we have hydrogen?” he told reporters after opening the Asia Pacific green hydrogen conference yesterday.Abang Johari was asked about the Federal Government’s decision to float the diesel price in Peninsular Malaysia effective yesterday.

The price of diesel in the peninsula is set at RM3.35 per litre, based on the unsubsidised market price according to the Automatic Pricing Mechanism formula for last month.

Finance Minister II Datuk Seri Amir Hamzah Azizan revealed that the weekly retail price of unsubsidised diesel will subsequently be announced every Wednesday, based on the formula.

In Sabah, Sarawak and Labuan, the diesel price remains at the subsidised rate of RM2.15 per litre.

Abang Johari also said there would be no need for petrol and diesel once the cost of hydrogen could be reduced.

“That is the solution. If we are still using diesel, people will keep asking for subsidies.

“Why can’t you have cheap alternative energy so you don’t have to use diesel?” he said.

In his speech earlier, Abang Johari said the Sarawak government, in collaboration with PETRONAS, had lowered the electricity requirement to produce 1kg of hydrogen from 60kW to 38kW.

“This advancement aims to cut hydrogen production cost by 50% and beyond, significantly enhancing its viability and competitiveness as an energy source,” he said.

Abang Johari also unveiled the Sarawak Energy Transition Policy (SET-P), which incorporates renewable energy sources and technology to ensure a clean and sustainable future.

He said it would focus on four main sectors comprising power, transportation, industry and buildings, as well as eight types of energy and technologies.

“These include renewable energy, hydrogen, energy efficiency, green mobility, synthetic fuels, bioenergy, oil and gas, and carbon capture, utilisation and storage (CCUS),” added Abang Johari.

Source: The Star

Abang Jo: Seek alternative energy sources such as hydrogen

Malaysia has approved RM114.7 billion worth of investments in data centres and cloud services between 2021 and 2023, said Prime Minister Datuk Seri Anwar Ibrahim.

In a post on X (formerly known as Twitter), he said these investments have created 2,325 high-value new jobs in specialised fields such as data scientists, data analysts, data engineers, cybersecurity analysts, and network engineers.

He said that the MADANI Government is committed to positioning Malaysia as a sustainable Artificial Intelligence (AI) Data Centre destination in Southeast Asia, as part of its effort to strengthen the country’s position as a leading global investment destination.

Earlier on, Anwar, who is also the Finance Minister, had chaired the 4th National Investment Council (NIC) meeting for the year.

He said the NIC had agreed for the Ministry of Investment, Trade, and Industry (MITI) to enhance the current incentive framework for AI data centres via the Malaysian Investment Development Authority (MIDA).

This includes the mechanism on the usage of energy and water-efficient equipment, as well as collaboration with the Ministry of Energy Transition and Natural Resources to provide sufficient renewable energy for AI data centres, the Prime Minister said.

“During the meeting, I had emphasised a whole-of-government approach in the ongoing efforts to encourage investment in AI-based data centre sectors, particularly in boosting economic benefits through digitalisation and increasing the economic complexity of various sectors in Malaysia.

“The framework will also include matching data centre players with local companies for the development of local vendors, especially small and medium enterprises, as well as fostering industry-academia collaborations to drive innovation in the development of energy-efficient equipment and software,” he said.

Earlier today, MITI Minister Tengku Datuk Seri Zafrul Abdul Aziz posted on X that MITI, via MIDA, will develop a special incentives framework for AI data centres.

Source: Bernama

Malaysia approved RM114.7 bln investments in data centres, cloud services from 2021 to 2023

Port of Tanjung Pelepas (PTP), a joint venture between Malaysia’s MMC Group and the Netherlands’ APM Terminals, is now the fifth most efficient container port in the world.

According to the recently published 2023 Container Port Performance Index (CPPI), PTP has risen from sixth place to the fifth ranked. PTP has also secured the top spot in Southeast Asia.

The CPPI, developed by the World Bank and S&P Global Market Intelligence, is based on the most extensive dataset to date, covering 405 ports worldwide. It includes more than 182,000 vessel calls, 238.2 million moves, and about 381 million twenty-foot equivalent units (TEU) for the whole of 2023.

PTP chairman Tan Sri Che Khalib Mohamad Noh said, “Achieving this new World Top 5 title shows that PTP’s drive for enhanced safety, operational excellence and continuous improvement truly makes a difference, boosting our performance throughout the supply chain and enabling us to deliver the best service to our customers.”

As the top performer in Southeast Asia, he added, PTP not only reinforces its status as Malaysia’s busiest and largest transshipment hub, but also solidifies its position as a vital trade gateway for this entire region, even amidst today’s challenging global shipping environment.

“This significant achievement is a testament to the remarkable tenacity of our people, and we are immensely proud of their efforts. It highlights our stability and unwavering commitment to serving our customers in the best possible way. I salute our hardworking employees for this outstanding accomplishment and extend my gratitude to all stakeholders who supported us,” said Che Khalib.

PTP CEO Mark Hardiman said, “This world ranking achievement is a significant milestone for PTP. Along with our various other accomplishments over time, it highlights PTP’s importance to the maritime sector, economic well-being, and trade for the global network.

“Equally important is our commitment to a clear business sustainability agenda as by aligning our environmental, social and governance initiatives, safety policies and digitalisation strategy, we not only enhance efficiency and optimise operations, but also minimise our environmental impact. One significant target is our on-going efforts aimed

at achieving a targeted 45% reduction in emissions by 2030, while we continue to strive for high performance.”

He added that the port will continue to invest in infrastructure, cutting-edge technologies and workforce to strengthen its leadership in global container port operations.

Recently, PTP became the first port in Malaysia to handle a record 1,077,747 TEU in a single month, May, without any congestion.

Source: The Sun

Port of Tanjung Pelepas now fifth most efficient container port in the world

Avisena Healthcare today celebrated the groundbreaking of its additional medical facility at Avisena Specialist Hospital in Shah Alam, marking a pivotal moment in its commitment to providing advanced quality patient care to cater to the increasing population in the Klang Valley. The event was officiated by Yang Berhormat Datuk Seri Dr Dzulkefly Ahmad, Minister of Health Malaysia.

The expansion building, set to be completed and operational by 2027, will feature 275 beds, 35 sub-specialities, over 80 specialist suites, 10 state-of-the-art operation theatres, including one hybrid operation theatre, and comprehensive oncology services. The 11-storey building, connected to the existing structure by a two-storey enclosed bridge, is designed with a modern ‘Biophilic’ architectural concept, promoting a healing environment through natural elements.

This expansion aims to enhance Avisena Specialist Hospital’s capability to deliver high-quality healthcare to a broader patient base, aligning with the government’s Public-Private Partnership (PPP) initiatives to strengthen healthcare access across the nation.

Yang Berhormat Datuk Seri Dr Dzulkefly Ahmad, Minister of Health Malaysia, commended Avisena Healthcare’s efforts, highlighting the importance of such initiatives in achieving the nation’s healthcare goals. “The expansion of Avisena Specialist Hospital is a commendable initiative that aligns with our national healthcare objectives. By increasing the number of hospital beds and enhancing specialised services, Avisena Healthcare is contributing significantly to our goal of improving healthcare access and quality for all Malaysians. This project is a clear example of the effective collaboration between public and private sectors in advancing our healthcare infrastructure, such as the accessibility treatment for cancer patients and palliative support services.”

Elina Nadia Omar, Group Chief Executive Officer of Avisena Healthcare, expressed her gratitude and vision for the future, “Today marks a historic moment for Avisena Healthcare as we embark on this significant expansion. We are committed to providing top-quality healthcare, and with this new facility, we aim to bridge the gap between patients and healthcare providers, ensuring quality and efficient care for all. This expansion not only enhances our capacity but is also designed with patient comfort in mind. It integrates smart technology to improve service delivery and reduce waiting times, making healthcare more accessible and efficient.”

Avisena Specialist Hospital is set to elevate its Centres of Excellence, encompassing fields such as Cardiology, Diabetes, Endocrinology and Metabolism (ADEM), Orthopaedics (Trauma and Spine) and Ear, Nose and Throat (ENT). These specialised units will enhance the hospital’s ability to provide advanced care in critical areas of medicine.

Moreover, the hospital will become the largest comprehensive oncology hub in the Shah Alam and Klang districts by 2027. Elina Nadia Omar emphasised, “With the introduction of state-of-the-art chemotherapy and radiotherapy facilities, we are dedicated to addressing the increasing demand for advanced cancer care, which includes supporting ongoing research to find better treatments. Our goal is to ensure that patients receive the best possible care.” In support of cancer awareness and treatment, Avisena Healthcare has made a donation to the National Cancer Society Malaysia (NCSM).

Avisena Healthcare also serves as a hub for medical tourism. Collaborations with the Malaysia Health Tourism Council (MHTC) and government agencies aim to attract international patients, further positioning Avisena Healthcare as a key player in the global healthcare market.

Avisena Healthcare is dedicated to fulfilling its commitments to sustainability. Participating in the Low Carbon Cities Framework since 2015, Avisena Healthcare has achieved a 14% decrease in annual greenhouse gas emissions and aims for a 30% reduction by 2030 through the UN Global Compact’s SDG Ambition Accelerator programme. Avisena Healthcare also provides free medical services through Klinik Bergerak Sutera, while Yayasan Avisena supports underprivileged patients, especially in emergency and life-saving cases.

By 2027, Avisena Healthcare will be able to provide 405 patient beds, 13 operation theatres, 150 medical specialists, and 1,600 staff across its Shah Alam hospitals. Avisena Healthcare’s investment extends beyond the development of the additional medical facility at Avisena Specialist Hospital Shah Alam; it also includes the upcoming Avisena Specialist Hospital Cyberjaya that is set to be operational by 2029 and the expansion of the Avisena Dialysis Centre network.

Source: The Edge Malaysia

Avisena Specialist Hospital Unveils Major Expansion — Elevating Healthcare Services in Shah Alam and the Klang Valley

The Ministry of Investment, Trade and Industry (Miti) will develop special incentives for artificial intelligence (AI) data centres, said its minister Tengku Datuk Seri Zafrul Abdul Aziz.

He said that AI data centres have a significant and positive economic spillover effect.

“Investment in advanced technology infrastructure and AI data centres can support the Madani government’s commitment to accelerate the nation’s digital transformation agenda across all sectors, while also facilitating the transition to a high-income economy.

“From 2021-2023, Malaysia approved RM114.7 billion worth of investments in data centres and cloud services, creating 2,325 high-value jobs in specialised fields such as data scientists, data analysts, data engineers, cybersecurity analysts, and network engineers,” he said in a post on X on Tuesday.

Tengku Zafrul added that as such, Miti will ensure Malaysia remains a preferred investment destination for AI data centres.

“The National Investment Council has agreed for the Malaysian Investment Development Authority (Mida) to provide an incentive framework, including the use of energy- and water-efficient equipment, as well as sufficient renewable energy to facilitate AI data centre investments in Malaysia,” he said.

Source: Bernama

MITI to develop special incentives for AI data centres, says Zafrul

Mah Sing Group Berhad (Mah Sing) celebrates a significant milestone with its maiden entry into the data centre sector, launching Mah Sing DC Hub@Southville City, with its first partner Bridge Data Centres (BDC), a company primarily owned by Bain Capital. The momentous occasion was witnessed by the Deputy Prime Minister of Malaysia cum Minister of Energy Transition and Water Transformation (PETRA), Yang Amat Berhormat Dato Sri Haji Fadillah bin Haji Yusof at the signing of a landmark collaboration agreement between Mah Sing and BDC.

Mah Sing Group has earmarked 150acres of land bank at Southville City, its 428-acre integrated freehold township, for further expansion into a leading Data Centre Hub with planned capacity of up to 500MW. While this is Mah Sing’s initial venture into the data centre sector, the collaboration with BDC on the initial 17.55 acres of land for a data centre with planned capacity of up to 100MW is just the beginning. Mah Sing envisions Mah Sing DC Hub@Southville City as a holistic digital infrastructure ecosystem, meticulously designed to accommodate the demands of AI, hyperscale, retail, and enterprise service providers.

Mah Sing DC Hub@Southville City is less than 50km from Telekom Malaysia’s (TM) upcoming new cable landing station in Morib, Selangor for the SEA-ME-WE-6 submarine cable system which will provide TM with one of the lowest latency routes connecting Malaysia with the rest of the world. With this proximity, Mah Sing DC Hub@Southville City will be able to provide dark fiber network for the data centre hub. Expected to be completed in the first quarter of 2025, TM’s Morib landing station will be a key landing site for Malaysia. Mah Sing DC Hub@Southville City’s locational advantage is compounded by the 20km proximity to the existing data centre hubs of both Cyberjaya and Bukit Jalil, creating a strategic triangle of data centre hubs.

Consequently, Mah Sing DC Hub is poised to attract a diverse clientele, including leading technology corporations, telecommunication giants, and prominent financial institutions. This strategic move underscores Mah Sing’s commitment to enhancing Malaysia’s digital infrastructure, further driving technological innovation and economic growth in the region.

Deputy Prime Minister Dato’ Sri Fadillah Yusof praised the venture stating, “This joint venture initiative between Mah Sing and BDC aligns with Malaysia’s digital transformation agenda and economic growth, reinforcing the nation’s position as a prime location for data centre investment in the Asia Pacific region. It also reflects the strong confidence and trust that investors have in our strategic and supportive environment. The establishment of a cutting-edge data centre in Southville City will meet the growing demand for digital infrastructure, positioning Malaysia as the digital hub of ASEAN. Our government’s proactive policies and incentives, such as the establishment of a smart grid and the push for renewable energy, further strengthen this initiative. By fostering innovation and creating substantial economic opportunities, this project will accelerate our progress towards becoming a high-income nation and solidify our standing as a leading digital economy in the region.”

Eric Fan, President of Bridge Data Centres expressed confidence in the collaboration, “We are delighted that our expansion journey in Malaysia has yielded strong results due to the accelerated demand for quality and scalable data centres. We believe the comprehensive approach provided by Mah Sing will ensure that the data centre will meet all regulatory requirements and be built to the highest standards, facilitating the creation of a state-of-the-art data centre. With Southville City’s locational advantage for data centres, we are confident of end users’ interest. We can harness Malaysia’s superior infrastructure, skilled workforce, and prime geographic location to offer top-tier data centre services. This initiative not only boosts our operational capabilities but also highlights Malaysia’s increasing significance as a digital hub in the Asia Pacific region.”

Tan Sri Dato’ Sri Leong Hoy Kum emphasising the strategic importance of the project said, “Southville City is an ideal location for a data centre hub, strategically positioned in a triangle with Bukit Jalil and Cyberjaya. This placement makes the region a central force in Malaysia’s digital transformation and technological advancement. This venture marks a strategic shift for Mah Sing, diversifying our revenue streams beyond property development which currently covers landed and high-rise residences, townships, offices, retail spaces and an increasing focus on industrial projects. Entering the data centre market allows the Group to establish recurring income, crucial for a more resilient financial foundation amidst market fluctuations. This emphasis on expanding recurring income aims to build a sustainable and recession-resistant business model, mitigating risks associated with property development cyclicality.

Beyond Southville City, Mah Sing’s other landbanks, such as MSS Business Park in Sepang, Selangor, which is also close to TM’s upcoming new cable landing station in Morib, present potential for similar data centre collaborations. This expansion underscores our commitment to leveraging our assets for long-term growth and recurring income opportunities. As we continue to innovate in property development and expanding our footprint in the data centre industry, we are exploring the immense opportunity of artificial intelligence and IOT to enhance our business and deliver value to our stakeholders.”

About Southville City

Strategically located just 19 kilometres from Kuala Lumpur City Centre, Southville City is a mature township with the essential infrastructure to support this major development. The collaboration between Mah Sing and Bridge Data Centres not only elevates Southville City’s profile as a modern, technologically advanced hub but also signifies a pivotal moment in Malaysia’s digital economy journey. This partnership will attract further investments, create job opportunities, and drive the overall growth of Southville City as a vibrant high-tech and business centre.

Source: The Edge Malaysia

Mah Sing launches Mah Sing DC Hub@ Southville City with Bridge Data Centres

Malaysia has made no secret of its ambition to be not only part of but also come out ahead in the Fourth Industrial Revolution (4IR), also known as Industry 4.0 or Industrial Revolution 4.0 (IR4.0). Over the past decade, the government has introduced a plethora of initiatives, with the latest being the National 4IR Policy and the Centre for the Fourth Industrial Revolution (C4IR), aimed at keeping the dream alive.

Yet, the leap into IR4.0 has not materialised as expected. A lack of capital and access to technologies, a dearth of skilled talent and stagnant salaries have impeded Malaysia’s IR4.0 readiness, particularly among micro, small and medium enterprises (MSMEs), which accounted for 97.4% of businesses in the country in 2022.

Malaysia’s IR4.0 journey began in 2015 with the National Internet of Things Strategic Framework. The framework did not translate into actual plans, which slowed things down. While the government launched the Industry4WRD Readiness Assessment Intervention Programme and the Malaysia National Policy on Industry 4.0 in 2018 to help build the momentum to IR4.0, it did not achieve widespread adoption.

Nonetheless, stakeholders believe that the advent of generative artificial intelligence (Gen AI) could serve as the great equaliser.

“IR4.0 is an important concept. It’s a way for companies to be a lot more global and a lot quicker [by utilising] technologies in order for them to be part of the global supply chain. [This is] to be able to be connected to their clients and suppliers to get the right information on time to do the right thing,” says Jaffri Ibrahim, CEO of Collaborative Research in Engineering, Science and Technology (CREST).

IR4.0 promises to be the next wave of digital transformation in the manufacturing sector, propelled by disruptive trends such as the surge in data and connectivity, advanced analytics, human-machine interaction and cutting-edge robotics.

“IR4.0 has always been talked about. We’ve had a number of years where the government has come together and stressed the point of IR4.0 and the next revolution. [However,] the adoption is not as complete as one thought it would be,” says Jaffri.

“There are successes. But as a whole, it hasn’t met expectations, even in the West. I think it’s no different in this part of the world.”

The disappointingly low rate of IR4.0 adoption has been exacerbated by limited access to capital, technological complexity and shortage of skilled personnel, notes Dr Afnizanfaizal Abdullah, head of innovation commercialisation at Malaysian Research Accelerator for Technology and Innovation (MRANTI). Understanding and navigating these new technologies can be daunting, especially for smaller enterprises without the resources of larger corporations.

But there is a need for the transition to IR4.0 to happen, especially among SMEs. As large companies are adopting IR4.0, this puts pressure on SMEs to remain competitive as suppliers or risk being left behind, says Jaffri.

That is because larger companies expect SMEs to be able to connect to their systems for data exchange and order processing. Moreover, these larger entities do not want to bear the cost of integrating with their suppliers. Instead, they expect real-time data on pricing and inventory.

“This way of doing business is happening right now with the bigger boys. If [SMEs] want to play at that level, [they] have to be connected to be able to be the supplier and partner of all these multinational [corporations]. If [they are] not, they will be too far down the line to be able to react and get a part of the business,” he says.

This makes it absolutely critical that Malaysian SMEs prepare for IR4.0, says Hanno Stegmann, managing director and partner at BCG X, the tech build and design unit of Boston Consulting Group.

Companies that continuously innovate to stay ahead of the game can ensure that they sustain their competitive edge. On the flip side, SMEs that do not adapt to new technologies, digitalise and leverage new tools are poised to fail or even go out of business in the long run.

The equaliser

This is where Gen AI comes in to disrupt the status quo. The tool that leverages advanced algorithms has democratised access to advanced technology for SMEs by reducing costs, simplifying usage and providing scalable and customisable solutions.

“Gen AI is a huge and significant accelerator for SMEs transitioning to IR4.0. Now, anyone can experiment with AI, thanks to the lower barrier to entry. What’s different with Gen AI is that it has shifted AI from the realm of experts to a broader audience through simple [and] conversational interfaces,” says Stegmann.

AI models are able to reproduce the knowledge embedded in their training data in real time during task execution, says K Raman, managing director of Microsoft Malaysia. Therefore, access to advanced skills are democratised.

“We see Gen AI as the great equaliser. In addition to delivering productivity gains, Gen AI lowers the barrier to entry into areas such as coding, graphic design and professional writing. For SMEs, this means a unique opportunity to leverage powerful AI capabilities to boost employee productivity, improve operational efficiencies, drive customer engagement and so much more,” he says.

The practical applications of Gen AI are vast and varied, says Stegmann. For instance, the technology can transform the customer service experience. Gen AI, with its ability to digest and analyse extensive datasets, can provide precise and real-time responses tailored to individual needs and preferences at scale.

Citing the example of an AI-driven personalisation engine that was developed as a result of a collaboration between Philippines-based GCash and BCG X, Stegmann says prior to the deployment of the engine, GCash could only manage about 30 customer relationship management (CRM) actions concurrently. The introduction of the AI-powered engine expanded its capability to more than 1,500 actions at any given moment.

“This engine can deliver over 225 million hyper-personalised messages daily, significantly boosting engagement and revenue by a factor of 10 compared to its previous CRM initiatives,” he says.

SMEs will be able to utilise Gen AI to streamline operations, enhance product development and optimise customer interactions, says Afnizanfaizal. Gen AI will be able to accelerate the transition to IR4.0 by automating complex tasks, enhancing data analysis and driving innovations such as AI-driven diagnostics and precision farming in sectors like healthcare and agriculture.

“The importance lies in staying relevant and competitive. Without transitioning [to IR4.0], SMEs risk falling behind in efficiency, market relevance and innovation capability,” he says.

“[This potentially leads] to reduced market share and diminished growth prospects. Transitioning enables them to harness the benefits of digital tools and technologies, [which are] essential to scaling and adapting to changing market demands.”

With Gen AI in the fold, SMEs can create and test digital twins of products without the high costs associated with physical prototypes, notes Jaffri.

From tailwinds to headwinds

Although some SMEs are enthusiastic about the potential of Gen AI to transform their businesses, others are cautious about the necessary investment and potential disruption to their businesses, says Afnizanfaizal.

These concerns stem from the costs involved in implementing AI technology, the complexity of the technology and worries about job displacement, says Jaffri.

“One of the primary worries is cost. Many SMEs operate on tight budgets and may find the initial investment in AI infrastructure and tools daunting … SMEs might also lack the in-house expertise required to deploy and manage AI solutions effectively,” he adds.

Nevertheless, Jaffri asserts that the long-term benefits of AI often outweigh the initial costs. To mitigate concerns about the complexity of AI implementation, partnerships with academic institutions and industry experts play a crucial role, he notes.

To some extent, this is already underway. SMEs have received a significant push towards Gen AI adoption, thanks to the substantial investments of major global corporations.

Microsoft, for example, has committed to invest US$2.2 billion over the next four years. This investment will go towards building cloud and AI infrastructure in Malaysia, creating AI skilling opportunities and establishing an AI Centre for Excellence.

These investments will lead to enhanced infrastructure, says Chin Chee Seong, national secretary-general of the SME Association of Malaysia. By having the data centres readily available, SMEs can tap into cutting-edge cloud infrastructure that eliminates the need for substantial upfront investment in hardware.

“The presence of these tech giants is expected to attract further foreign investments, creating a robust ecosystem for start-ups and SMEs … SMEs will be empowered to revamp their business models, enhance their competitiveness and successfully compete in the global market,” he says.

“[Furthermore] by expanding the pool of skilled workers [through training programmes to upskill the Malaysian workforce], the shortage of ICT (information and communications technology) talent in Malaysia [will be addressed] by providing SMEs with access to a larger and more capable workforce to drive their digital transformation efforts.”

MRANTI is supporting the segment by providing access to specialised facilities for technology testing and commercialisation, facilitating connections with investors and experts, and offering training programmes to upskill, says Afnizanfaizal.

“This support is crucial to effectively integrate and leverage AI technologies. Specifically, in our AI sandbox, companies are supported with technical facilitation, including technology experts from Nvidia and Amazon Web Services (AWS), potential investment from the funding partners and linking up with potential clients among public ministries and agencies,” he adds.

Collaborative ecosystems have to be established where government bodies, private companies and educational institutions work together to promote AI adoption among SMEs, says Jaffri. These partnerships facilitate knowledge sharing, resource pooling and joint development projects to make AI more accessible.

Bankrolling IR4.0

Ultimately, funding is crucial to enabling the transition.

For example, as part of the coordinated IR4.0 strategy, the Ministry of Investment, Trade and Industry (Miti) designated the Malaysian Investment Development Authority (Mida) to administer the Industry4WRD Intervention Fund, offering eligible SMEs grants of up to RM500,000 on a 70:30 matching basis. Companies can receive an upfront disbursement of 30% of the matching amount, with the remainder reimbursed based on eligible expenditures

Mida also provides Automation Capital Allowance (Automation CA), which serves as an incentive for manufacturing and service enterprises to boost productivity by investing in automated machinery and equipment. Under this initiative, the agency offers a 200% Automation CA on the initial RM4 million for expenses for labour-intensive industries and the first RM2 million for other sectors, including services. The Automation CA has been extended until 2027, with the quantum increased to RM10 million.

However, only 281 SMEs were approved to receive the financial support facility from 2020 to 2022, with a total grant value of RM101.4 million, Mida’s executive director of investment policy advocacy (manufacturing) Masni Muhammad told Bernama in October last year. Of the total, 82 SMEs were approved for the fund in 2020, 111 in 2021 and 88 in 2022.

To put this in context, there are more than 1.17 million MSMEs in Malaysia, which generated 38.4% of the country’s GDP and provided employment for 7.59 million people in 2022, according to the Department of Statistics Malaysia.

The poor uptake is mainly due to lack of awareness of the existence of such financial assistance in the first place, says SME Association of Malaysia’s Chin. The high cost to get the necessary verification and arduous requirements further complicate matters.

“Many SMEs are also not informed [about the existence of these incentives]. And if they are, many believe they will never get it due to the stringent and difficult application process,” he says.

For instance, for the Automation CA, applicants will need to go to Sirim Bhd — the government’s industrial research and technology organisation — for a verification of the automation equipment before submitting the application to Mida for approval.

“[Previously,] some SMEs may have been reluctant to apply because there were some application costs. But with the increase in quantum, they should be more willing to apply now,” says Chin, adding that there needs to be more promotion of the initiatives provided to create awareness among SMEs.

This is because with financial support, companies can invest in cutting-edge technologies, upgrade their infrastructure and access the expertise needed to innovate and stay competitive, says Jaffri.

An example is the CREST R&D grant, which provided RM130,000 to TT Vision Holdings Bhd and Universiti Sains Malaysia as part of an industry-academia collaboration. “This funding led to the successful development of an automated online inspection system for solar wafer micro-crack detection, leveraging photoluminescence imaging and a machine learning-based algorithm,” he says.

Meanwhile, MRANTI facilitates access to funding through initiatives such as the National Technology and Innovation Sandbox (NTIS), which helps companies to deploy their innovations within a safe and controlled environment.

Taking it to the next level

Every bed of roses has its thorns. While AI comes with a host of benefits, there are issues to be addressed.

Models used by local SMEs need to be appropriate for local contexts to derive meaningful benefits from Gen AI, says Dr Rachel Gong, deputy director of research at Khazanah Research Institute.

“This means using training data based on Malaysian markets, practices and supply chains. This is where the rubber meets the road. There needs to be enough information shared about all these localisations that can then go into training models that suit local SMEs,” she says.

“Historically, data has been a very big challenge and I don’t expect that to change quickly. Language is another challenge for Gen AI models in Malaysia as the models are not equipped to sound natural in Malaysia’s multilingual and multicultural society.”

Moreover, it is essential for policies and regulations to support the transition for SMEs to IR4.0, says MRANTI’s Afnizanfaizal. These are ethical AI policies that allow governance of data as well as the alignment of existing policy and guidelines in various industries.

“On data security and privacy, the first step would be improving data regulations to take into account how data fed into Gen AI tools are governed. At this point, we have data regulations for personal data, but they only cover transactions, which would presumably exclude data used in Gen AI training,” says Gong.

“Next, there would have to be some sort of grievance process by which consumers and businesses who feel their data might have been leaked or misused by AI can seek redress. Such a process may mean having to retrain a model so developers and deployers need to be consulted.”

As Gen AI is heavily dependent on large amounts of data, it is important to get support from various agencies and ministries to assess certain data for training the models with better accuracy, says Afnizanfaizal. MRANTI will focus on promoting localised large language models, in which models are trained with local data rather than using existing data in public repositories.

“For policies to be effective, they must be developed in collaboration with recognised experts in the field. In Malaysia, it is important to focus on policies that support upskilling and training as IR4.0 necessitates a workforce that is agile, skilled and capable of adapting to new tools and methodologies,” says BCG X’s Stegmann. In any case, there needs to be a deep understanding of Gen AI’s potential and limitations across all levels of an organisation, he adds.

BCG advocates for a strategic approach via the 10-20-70 formula. This means 10% of the effort will go to developing an adequate machine learning model, 20% of the effort is focused on sourcing high-quality data and implementing the technology, and the lion’s share at 70% is dedicated to change management. This is to develop new business processes and transform existing operations.

“There’s a common understanding that transitioning to IR4.0 and embracing technologies like Gen AI isn’t an option — it’s a necessity. However, there’s also a palpable sense of apprehension,” says Stegmann.

“It’s akin to a rabbit frozen in the glare of an oncoming snake. IR4.0 isn’t the snake, though. It’s the ladder to unprecedented opportunities.”

Utilising patents to turn the tide

While the emergence of generative artificial intelligence (Gen AI) could be a game-changer in facilitating small and medium enterprises’ (SMEs) transition to Industrial Revolution 4.0 (IR4.0), the significance of tools like patents should not be overlooked in the meantime.

“Patents play a crucial role in encouraging investment in innovation as entrepreneurs are more likely to invest time and resources in developing new and groundbreaking products and services when they know their ideas, inventions and creations are legally safeguarded,” says Dr Afnizanfaizal Abdullah, head of innovation commercialisation at Malaysian Research Accelerator for Technology and Innovation (MRANTI).

Patents can be a strategic advantage for businesses through cross-licencing agreements, says Cheah Bok Eng, a Malaysian inventor with more than 190 patents to his name. Cross-licencing allows access to technologies by incorporating advancements from another company’s patents. This is when companies with relevant patents cross-licence and grant each other permission to use each other’s technology.

“Joining patent pools or entering into cross-licencing agreements with other companies provides access to a broader range of technologies, facilitating the development of more comprehensive and innovative solutions. Patents help maintain a competitive edge by differentiating products in the market and can be monetised through licensing agreements, selling IP (intellectual property) rights or using them as collateral for loans and generating additional revenue for reinvestment in further technological advancements,” says Afnizanfaizal.

One of the biggest stumbling blocks for SMEs in driving innovation is their limited resources to cope with strategic or growing domains beyond the maintenance of business, says Cheah. Another aspect is the limited financial capacity that could deter SMEs from pursuing the costly IP protection such as patent applications.

“Tax incentives for companies pursuing IP protection could be formulated by policymakers to accelerate growth of the knowledge economy or make IP protection more affordable,” says Cheah.

“Strong IP protection also attracts foreign investment by signalling to foreign investors that their investments in Malaysia will be secure, ensuring that they can recoup their investments and generate profits,” Afnizanfaizal adds.

This is why developing a comprehensive IP strategy aligned with business goals is necessary, he says. This is done by focusing on continuous research and development, collaborating with patent experts and consultants, leveraging their patents through licensing agreements, joining patent pools, regularly monitoring the market for potential infringements and taking appropriate action to enforce legal rights and staying updated on changes in patent laws and regulations.

“By adopting these strategies, SMEs can effectively leverage patents to accelerate their transition to IR4.0, protect their technological advancements and position themselves for success in an increasingly digital and competitive market,” says Afnizanfaizal.

Source: The Edge Malaysia

Levelling the IR4.0 playing field

EQUINIX Inc, a global digital infrastructure company, has expanded its footprint in Malaysia with the opening of its Johor (JH1) International Business Exchange (IBX) data centre located at Nusajaya Tech Park in Iskandar Puteri, Johor. 

Built with an initial investment of approximately US$40 million (RM188 million), JH1 is the first of two Equinix data centres in Malaysia, with the second, KL1 IBX, operational in Cyberjaya since January. 

The two-storey JH1 facility spans 1,800 sqm and boasts a maximum capacity of 500 cabinets. 

Services available at JH1 include the company’s primary interconnect service, Equinix Fabric, as well as Cross Connect, Equinix Internet Access, Equinix Internet Exchange (IX) and Metro Connect. 

Equinix maintains a strong reputation for reliability, claiming a 99.999% uptime record. 

During a tour of the facility, president (Asia Pacific) Jeremy Deutsch said the company would maintain its standard at JH1. 

“JH1 is equipped with an uninterruptible power supply (UPS) system, allowing the data centre to operate for up to 15 minutes during power interruptions. 

“Additionally, four onsite power generators are available to support the data centre during prolonged outages,” he said. 

Both JH1 and KL1 data centres have been running on 100% renewable energy (RE) since their inception. 

In line with Equinix’s commitment to sustainability, JH1’s cooling system is designed to convert the hot air emitted by servers back into cool air, which is then recirculated by the system. 

During the tour, members of the media observed a group of servers being set up for artificial intelligence (AI) workloads, while another set of servers was already functioning, though their purpose remained undisclosed. 

Deutsch did not reveal the owners of these servers but mentioned that several content providers, fintech players, gaming companies and AI outfits are already utilising JH1 and KL1. 

However, he said local tech giants such as TIME dotCom Bhd and Maxis Bhd are part of the Equinix ecosystem. 

Upon observation, the JH1 IBX data centre offers numerous benefits including access to a rich network ecosystem of highly connected data centres in Singapore and globally, with proximity to major IX. 

It extends its reach to the richest digital ecosystem in cloud and IT, content and media services, and financial exchanges via Platform Equinix. 

Additionally, it allows for expansion into Malaysia’s digital economy, tapping into the domestic market. 

Features and Facilities 

The JH1 data centre is equipped with various amenities such as a break room, loaner tools, crash carts, work kiosks, WiFi and a conference room, while also offering a range of products and services. 

The facility also includes private cages for enhanced security, secure cabinets for storing equipment, AC power circuits for reliable power supply, and IBXFlex office and storage solutions. 

Although it is yet to be confirmed, JH1 data centre plans to offer additional services such as Smart Hands for remote management, IBX SmartView for infrastructure monitoring, Equinix Infrastructure Services, Equinix Metal for bare metal deployments, Network Edge for network optimisation and Equinix Precision Time for precise time synchronisation. 

The JH1 facility was constructed using a combination of cast-in-situ concrete and steel structure. Plus, on-site parking is available for users’ convenience. 

The floors were made of reinforced concrete ensuring they could support the heavy equipment typically used in data centres. 

Additionally, the data centre is equipped with “Very Early Smoke Detection Apparatus” and a comprehensive fire alarm system to ensure safety. 

The JH1 data centre has a power density of 4.8 kVA (3.84 kW) per cabinet and features two utility feeders. 

Meanwhile, its UPS configuration is block redundant with N+1 redundancy, ensuring continuous power supply. 

Standby power is provided by four 2,000 kVA generators in an N+1 configuration. The cooling system uses high-efficiency DX CRAC inverter-based compressors with N+ 20% redundancy. 

Security measures at the JH1 data centre include physical barriers such as a man trap, security gate, perimeter fence and gate. The facility is monitored around the clock by on-site security officers. Electronic security features include biometric readers, PIN and card readers, CCTVs and recorders.

After the tour, Equinix MD Cheam Tat Inn said the company underscored the pivotal role of digital infrastructure in meeting contemporary business challenges and seizing emerging opportunities.

“Digital infrastructure enables businesses to tackle challenges and pursue possibilities. Considering the staggering data volumes we are dealing with, by 2025, we expect to handle 181 zettabytes (ZB) of data in real time. 

“Just a few years ago, we were talking about petabytes, and now we are dealing with ZB,” he said. 

He added that today’s data is not just structured text, it includes unstructured data like videos, which are growing at an unprecedented rate. 

Cheam said the increasing deployment of AI technologies highlighted the exponential growth of the market. 

“Every day, we hear about new AI applications and use cases. Many of you have likely tried tools like ChatGPT, which showcase the vast potential AI holds for businesses and personal use. 

“The AI market, valued at US$6.2 billion in 2023, is projected to soar to US$16.2 billion by 2028. This growth within the digital ecosystem has also led to a 60% reduction in data transfer costs among ecosystem partners as more players join, driving down overall costs,” he added. 

In Malaysia, the digital economy is a substantial contributor to the GDP, accounting for 22.6% and is expected to rise to 25.5% by 2025. 

The Asean region, recognised as the fifth-largest economy globally with a population of 691 million, is projected to achieve a GDP of US$5.5 trillion by 2028, Cheam said. 

He added that this shift is further accelerated by the proliferation of AI, which has significantly increased demand for digital infrastructure. 

“Malaysia, particularly Johor, is emerging as a preferred data centre hub due to limited capacity in Singapore and strong governmental and ecosystem support. 

“The lower cost of land in Johor makes it an attractive investment destination,” he said. 

Cheam added that cloud-adjacent storage is crucial. 

“Many applications are moving to the cloud, but data might be located elsewhere, causing latency issues, especially in analytics. 

“Cloud storage ensures data is close to the cloud, enhancing performance and reducing latency. 

“This trend is evident in our data centre deployments,” he said. 

Connected to Everything 

Cheam said Equinix’s data centres offer access to a diverse global ecosystem. 

With over 462,000 interconnections, businesses can access the largest and most dynamic global ecosystem. 

Equinix’s platform includes more than 2,000 networks, 5,000 enterprises, and 3,000 cloud and IT service providers. 

This extensive network facilitates interconnection opportunities, enabling businesses to discover and transact with customers, suppliers and partners, thereby creating and consuming new value. 

Key Features and Benefits 

To echo Cheam’s earlier remarks, the JH1 facility is strategically located just 15km from Singapore. 

This proximity addresses the heightened demand from both local enterprises and organisations in neighbouring regions. 

Similarly, the KL1 facility in Cyberjaya, a key part of the Multimedia Super Corridor, is expected to provide 900 cabinets and 2,630 sq m of colocation space once fully built out. 

Equinix’s data centres in Malaysia are entirely powered by RE, aligning with the company’s goal to achieve climate neutrality by 2030. 

Both JH1 and KL1 adhere to the globally accepted A1A standards from the American Society of Heating, Refrigerating and Air-Conditioning Engineers, enhancing their overall efficiency and helping customers reduce their Scope 3 carbon emissions. 

Equinix will provide robust interconnection and digital services at JH1 and KL1, including Equinix Internet Access in both locations by the second quarter of 2024 (2Q24), Equinix Fabric and Equinix Fabric Cloud Router at JH1 by 2Q24 and KL1 by 3Q24, and Equinix IX shortly after. 

These services enable seamless connectivity, enhanced scalability, optimised performance and increased flexibility, empowering businesses to thrive in today’s rapidly evolving digital landscape. 

In reflection, Equinix’s expansion in Malaysia, exemplified by the opening of the JH1 and KL1 data centres, represents a significant leap forward in the nation’s digital infrastructure. 

By providing access to a vast global ecosystem and advanced digital services, Equinix is well-positioned to support Malaysia’s digital economy ambitions and drive sustainable economic growth in the region. 

Malaysian businesses will now have access to a global ecosystem of over 10,000 enterprises, networks and cloud service providers, while global businesses can tap into the digital opportunities presented by the nation. 

As businesses continue to embrace digital transformation and advanced technologies such as AI, their need for a network-dense cloud-adjacent, and on-demand digital infrastructure becomes paramount. 

Platform Equinix plays a pivotal role as a facilitator of innovation, economic growth and empowerment for businesses in Malaysia. 

Notably, content, fintech, gaming and AI companies have already chosen to deploy their IT infrastructure on Platform Equinix in Malaysia. 

As mentioned by Deutsch, leading global and local network service providers such as TIME and Maxis have joined Equinix’s network ecosystem in Malaysia, providing a highly interconnected and secure environment for customers. 

In his speech during the launch, Deustch said Malaysia is a cornerstone market and top destination that is highly sought after by our valuable customers. 

“Our unwavering dedication to the South-East Asia region underscores our belief in its immense potential to drive digital transformation and accommodate a growing digital-savvy population,” he said. 

The digital infrastructure company is dedicated to delivering exceptional digital infrastructure solutions that empower businesses to thrive in this dynamic landscape, fuelling innovation, economic growth and societal advancement. 

Equinix’s entry into Malaysia also aligns with the MyDIGITAL initiative introduced by the government, which outlines a strategy for accelerating the development of digital products and services. 

Equinix data centres in Malaysia are powered entirely by RE. It is on track to achieve climate neutrality by 2030, with a strong focus on incorporating clean RE sources throughout its worldwide operations. 

Equinix’s commitment to sustainability is another critical aspect of their operations, Cheam said. 

The National Energy Transition Roadmap provides a solid framework for Malaysia’s transition to RE, aligning with the demands for sustainability from hyperscalers. 

“We are dedicated to protecting the planet, aiming for 100% RE and global climate neutrality by 2030. We have invested US$4.9 billion in green bonds towards green building, energy efficiency and renewables,” he shared. 

Despite its business expansion, it has reduced its absolute emissions by 23% since 2019. 

Its innovations include liquid cooling, heat recovery and low-carbon fuel cells, all designed to minimise environmental impact. 

In 2023, Equinix achieved 96% RE coverage across its global operations. 

Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz said Equinix’s decision to expand its presence in Malaysia reflects its continued confidence in the country’s industrial landscape, which is undergoing key transformative initiatives as outlined in the New Industrial Master Plan (NIMP) 2030. 

He added that one of NIMP’s missions is for Malaysia to tech up rapidly to be a digitally vibrant nation, and Equinix’s new data centres in Kuala Lumpur and Johor will support this mission by enhancing Malaysia’s digital infrastructure.

These data centres will provide businesses, particularly domestic SMEs, with seamless connectivity and access to a vast global network, while driving innovation across diverse sectors in Malaysia.

“Most importantly, Equinix’s investment will pave the way for the creation of high-value job opportunities and propel economic growth, empowering our people and businesses to excel in the digital age,” Tengku Zafrul added.

Also present at the launch was Johor State Executive Council and chairman of Investment, Trade and Consumer Affairs Lee Ting Han. 

“We welcome Equinix’s investment in Johor, which is expected to become the most economically developed state in the country soon,” he said. 

He said Equinix’s world-class facility would enhance the nation’s technological capabilities, attract global businesses, create new job opportunities and drive economic growth. 

He said this partnership will position Johor as a key player in the digital economy, fostering innovation and propelling the state towards a prosperous future. 

Malaysia Digital Economy Corp (MDEC) CEO Mahadhir Aziz seconded the strategic importance of Equinix’s new data centres. 

“We are proud to have facilitated Equinix’s market entry into Malaysia with its investment in the JH1 and KL1 data centres,” he said in a statement. 

These new facilities will significantly enhance Malaysia’s digital capabilities and further strengthen Malaysia’s digital infrastructure backbone, in line with its national strategic initiative, Malaysia Digital. 

“I believe data centre investments will certainly create economic spillovers, particularly high-value direct and indirect jobs along the value chain. 

“MDEC is committed to fostering effective collaborations to firmly establish the nation as the digital hub of Asean,” Mahadhir said. 

On a similar note, Malaysian Investment Development Authority (MIDA) CEO Sikh Shamsul Ibrahim Sikh Abdul Majid said Equinix’s expansion in Malaysia reinforces the country’s standing as a digital hub in the region. 

According to him, Equinix’s advanced data centres will create significant opportunities for businesses, especially local enterprises, to innovate and grow as they integrate with the global ecosystem. 

“MIDA is dedicated to facilitating investments like Equinix’s, which not only drive economic growth but also foster innovation and create sustainable employment opportunities in Malaysia,” he said. 

These endorsements from key stakeholders showcased the positive impact of Equinix’s investments in Malaysia. 

The new data centres are set to bolster the nation’s digital infrastructure, drive economic growth and position Malaysia as a leading digital hub in the Asean region. 

Moving forward, Equinix’s data centres in Malaysia are set to revolutionise the digital landscape, providing businesses with unparalleled access to global networks and cutting-edge technology. 

This expansion is supporting the nation’s digital economy ambitions and fosters economic growth, positioning Malaysia as a key player in the global digital economy. 

Source: The Malaysian Reserve

Equinix continues expansion plan, unveils new data centre

ikTok owner ByteDance plans to invest in artificial intelligence (AI) and turn Malaysia into a regional AI hub with a proposed investment of about RM10 billion.

In a post on X (formerly Twitter), Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz said this was conveyed to him during his meeting with TikTok vice president Helena Lersch in Singapore today.

“The additional investment from ByteDance will certainly help Malaysia in achieving the target of growing the digital economy to 22.6 per cent of Malaysia’s Gross Domestic Product by 2025,” he said.

The minister also noted that TikTok, through ByteDance System Sdn Bhd, has developed a data centre at Sedenak Tech Park in Kulai, Johor.

Taking into consideration future requirements, Tengku Zafrul said, the company also plans to expand the data centre facility with an additional investment of RM1.5 billion.

Source: Bernama

ByteDance plans RM10 bln investment in AI, to make Malaysia regional hub

Sarawak has the potential to be a green hydrogen leader because of its ample hydropower, heavy rainfall and long coastline, said Peter Cockcroft, director of the Asia Pacific Net-Zero Institute Pte Ltd.

He pointed out that there are several ways to make hydrogen, but a lot of it currently comes from coal and natural gas, both of which release carbon dioxide (CO2), an emission that needs to be reduced.

Hydrogen production is differentiated by colors: black and grey (from coal and natural gas), blue (from natural gas with carbon capture), and green (from water using renewable energy).

“Green hydrogen, the cleanest type, is made through electrolysis, needing cheap and steady electricity, plenty of fresh water, and a way to separate hydrogen (H2) from oxygen (O2),” Cockcroft said in a recent interview, set up in connection with the upcoming Asia Pacific Green Hydrogen (APGH) Conference and Exhibition 2024 here.

“Sarawak stands out from the rest of Malaysia due to its significant hydropower resources, abundant rainfall, and long coastline. In Southeast Asia, Sarawak has the highest hydropower capacity among similar regions, providing a better renewable fuel choice than solar or wind.

“Hydropower runs constantly, offering reliable energy unlike solar and wind, which are intermittent. This gives Sarawak a competitive edge in business,” he said.

Cockcroft recognised Sarawak’s economic feasibility and market potential, noting its ability to reduce electricity expenses and attract global industries aiming to reduce carbon emissions.

He suggested a thorough plan with strategic steps, such as finding suitable sites, calculating production expenses, and creating a sales pitch to draw in investors and industries needing hydrogen.

Net-Zero Institute Pte Ltd specialises in international net-zero and decarbonization planning.

Meanwhile, Vicente Pinto, InvestChile’s counsellor for investment affairs in Asia, emphasised the need for global cooperation in advancing green hydrogen technology.

He regarded building a unified chain of operations through strategic partnerships as being essential for seamlessly integrating hydrogen production, transportation, and use.

“In this new industry, emission complexities require collaboration among stakeholders like producers, shipping companies, ports, and transport providers. Unlike traditional models, the green hydrogen value chain needs coordinated efforts among sectors that were once only customers.

“This complexity might explain the slower progress of the industry, underscoring the need for ongoing cooperation between governments and the private sector to optimise the value chain,” he explained.

Pinto said Sarawak’s potential to lead the green hydrogen economy in Asean was due to its current leadership in oil and gas and its strategic location.

Therefore, he recommended for Sarawak to develop a thorough hydrogen strategy, cultivate international partnerships, and invest in the required infrastructure for hydrogen projects.

Public perception and awareness are crucial for green hydrogen to succeed.

Cockcroft and Pinto are both in the international panel of speakers at the APGH 2024, running from June 10 to 12.

For more information on the event, go to www.hydrogenapac.com.

Source: Borneo Post

Sarawak has competitive edge in green hydrogen business, say experts

A Sabah government-linked company (GLC) will pioneer the green technology park (GTP) in the state.

To realise the sustainable development goal, Sawit Kinabalu, through its subsidiary, Sawit Palm Oil Industrial Cluster Sdn Bhd (SPOIC), signed a Memorandum of Understanding (MoU) with Nextgreen Global Berhad (NGGB) for the establishment of the GTP.

Sabah Chief Minister Datuk Seri Hajiji Noor, who is also Sawit Kinabalu chairman, witnessed the signing ceremony at the Sawit Kinabalu’s new headquarters at Block B, Menara Kinabalu here.

Sawit Kinabalu was represented by its group managing director and chief executive officer Victor Ationg, while NGGB was represented by its group managing director Datuk Lim Thiam Huat.

Through the MoU, both parties will explore and implement key activities of the GTP, such as establishing a collection and processing centre (CPC), a pulp mill, a raw water treatment plant, and a steam boiler on 400 acres of land owned by SPOIC in Sandakan.

The green business concept of the GTP emphasises renewable energy, recovery, and waste elimination, forming the foundation for a green economy that can reduce environmental risks and drive Sawit Kinabalu towards sustainable development.

Earlier, Hajiji inaugurated Sawit Kinabalu’s new headquarters and chaired the company’s board of directors meeting.

He later witnessed the payment of business zakat for the year 2023 amounting to RM800,000 from Victor to Sabah Islamic Religious Council (MUIS), Datuk Mohd Dandan @ Ame Alidin.

Source: NST

Sabah GLC to lead establishment of state’s green technology park

While Greater Kuala Lumpur and Johor remain the two locations with the highest growth in the number of data centres in Malaysia, other locations will also start seeing more data centre developments as demand continues to increase, according to JLL Malaysia.

In his presentation at JLL Malaysia’s Data Centres Perspectives event held on Thursday, JLL Malaysia data centre team member Kent Seet said that besides Johor and Greater Kuala Lumpur, Negeri Sembilan and Kedah could see a rise in data centre development activities.

“These two states can provide the necessary resources and infrastructure. And, JLL believes that if the process of upgrading existing or building new data centres in the mature locations could not be done speedily, Negeri Sembilan and Kedah might benefit from the overspill of demand from KL and Johor,” he said, adding that that aside from the established technology parks in Cyberjaya and Bukit Jalil, other areas in the Klang Valley could be potential areas for data centres as well.

Seet also highlighted that Johor will continue to grow as a data centre hub, thanks to the instrumental role of the state authorities in reducing red tape and streamlining processes in data centre developments.

“The data centre growth will be driven by established data centre-centric parks such as the Sedenak Tech Park and also pockets of new industrial parks in other locations such as Kulai, Skudai, Plentong and Tanjung Kupang, all these being potential locations,” he noted.

Meanwhile, Malaysia Digital Economy Corporation (MDEC) head (digital infrastructure and digital enablers) Tan Tze Ming shared in his presentation that, while the hotspots for data centres are concentrated mainly on the west side of Johor, there is potential for developments also on the east side, such as Pasir Gudang.

“There is plenty of land, water and power in Pasir Gudang. The only issue is that there is not yet a cable connection to the east side of Singapore. At the moment, MDEC is looking to secure potential developers, but without a bridge, it is not easy to get the cables across [to eastern Singapore]. We are also working on getting the open submarine cable landing stations ready, one on the western coast and another on the eastern coast of Johor, which will allow any subsea cables to enter Malaysia and enhance connectivity for Johor-based data centres,” he said.

Tan revealed that MDEC is also proposing a new submarine connectivity route for US-linked cables off the coast of Sabah and Sarawak, bypassing the disputed nine-dash line in the South China Sea, to ensure that East Malaysia is also benefitting from the data centre boom.

According to JLL Malaysia’s report entitled Data Centres: The Malaysian Perspective, which was launched on Thursday at the same event, it stated that Malaysia’s data centre market has experienced significant growth, driven by factors such as the rise of cloud computing and artificial intelligence (AI), growth of digital services and increasing data-intensive activities in various industries.

According to the report, as of 2022, Malaysia has a social media penetration rate of about 91.7%, outpacing Singapore’s at 89.5%, suggesting further growth potential for the data centre segment in the country.

As for total power capacity supply, the current figures stood at about 262 megawatts (MW), and the figure could grow to approximately 860MW by end-2025. “Taking into account all proposed data centre projects, the country is looking at a potential wattage of approximately 2,270MW beyond 2027,” the report said.

Source: The Edge Malaysia

JLL Malaysia anticipates more data centre developments across Malaysia due to rising demand

Integrated logistics solutions provider Tasco Bhd (KL:TASCO) plans to invest an additional RM400 million from now to 2026 to expand its warehouse capacity.

Executive chairman and substantial shareholder Lee Check Poh said the group has so far invested RM300 million in the expansion of its warehouses, exceeding the minimum RM240 million investment in capital expenditure (capex) to qualify for the income tax exemption under the Malaysian Investment Development Authority’s (Mida) integrated logistics services (ILS) scheme.

“Mida has awarded us the ILS scheme twice. The first one was for a five-year period from 2003 to 2007. We invested RM90 million in the first round. The second one was for a five-year period from 2021 to 2026 of a minimum RM240 million investment, which we have already invested RM300 million, as of today,” he said at the launch of Tasco’s new four-storey warehouse under phase one of the Shah Alam Logistics Centre (SALC) on Thursday.

The event, which was officiated by Selangor Menteri Besar Datuk Seri Amirudin Shari and Japanese Ambassador to Malaysia Katsuhiko Takahashi, was in conjunction with the group’s 50th anniversary this year.

“We still have two more years to go. From our investment strategy pipeline, we will most probably invest another RM400 million until 2026, bringing total capex to RM700 million under the second ILS scheme,” Lee said, adding that the warehouse expansion is expected to create 800 jobs this year alone.

The newly built warehouse adds 600,000 sq ft to the 400,000 sq ft of warehousing space Tasco currently owns in the same premises.

According to Lee, about 70% of Tasco’s newly launched four-storey SALC warehouse has been leased out to customers. He added that Tasco is currently in negotiations with a potential customer to take up the remaining space.

Warehousing capacity at Shah Alam hub to grow to 1.4 million sq ft by 2026

Part of the RM400 million capex will be used for phase two of SALC, which will see another 400,000 sq ft of warehousing space added, bringing the total to 1.4 million sq ft by 2026. “The group’s old headquarters will be demolished and replaced with a four-storey warehouse, which will connect to today’s newly-launched warehouse and will use the same ramp,” said Lee.

Tasco also plans to build two new warehouses in Northport, which will span 600,000 sq ft in total. Almost half of that facility will cater to cold storage warehousing with automated storage and retrieval systems (ASRS). Tasco’s 70%-owned subsidiary Tasco Yusen Gold Cold Sdn Bhd (TYGC) is currently the biggest cold chain player in Malaysia. In 2019, Japan Overseas Infrastructure Investment Corp for Transport and Urban Development (JOIN), a Japanese government investment company, had invested 30% in TYGC.

Lee conceded that the massive inflow of new warehousing capacity coming into the market could result in an oversupply in the short term. “But I believe in the medium-and long-term, it should stabilise so long as the economy keeps growing.”

Earlier in his speech, Amirudin said the Department of Statistics, Malaysia data showed that Selangor’s population has pushed past 7.3 million and this continues to grow.

“That is more than 20% of Malaysia’s population located across nine districts and 12 local councils. And the majority are young people primed to enter or have just entered the workforce thanks to the more than 160 universities located across the state.

“These two factors mean you not only have a ready-made market, but a workforce primed to take up the job opportunities your investment will surely offer,” he noted.

Amirudin added that his state administration will table the mid-term review of the First Selangor Plan (RS-1) at the upcoming Selangor State Assembly in July. “We will then present RS-2 in 2025 or early 2026. Infrastructure and the services sector are one of the key pillars (in the plan) where we will establish the Greater Klang Valley as the metropolis of Selangor and Malaysia. Working together with the private agencies, the government sector, the people of Selangor and companies, we are confident that activities in Selangor will contribute 30% to the national gross domestic product by 2026/2027.”

Tasco’s share price closed unchanged at 96.5 sen on Thursday, giving it a market capitalisation of RM772 million. Its share price has risen 25% so far this year.

Source: The Edge Malaysia

Tasco to invest additional RM400m to expand warehouse capacity over next two years

Development plans for the industrial component at Gerbang Nusajaya in Johor are gradually taking shape, with detailed plans now in place.

These include a 40-acre renewable energy industrial park in Precinct 2 and a 74-acre data centre (DC) campus in Precinct 4.

RHB Research anticipates strong interest from global DC players.

“We understand that additional power supply may be added in the area to support industries and investments,” it said in a note.

The research firm noted that UEM Sunrise Bhd (UEMS) is well-positioned to capitalise on Johor’s multiyear growth and the state’s burgeoning data centre (DC) sector, thanks to its strategic presence in Iskandar Malaysia.

UEMS’ collaboration with LOGOS Infrastructure Holdco (LOGOS) marks a significant move into the expanding DC segment.

Both parties have signed a memorandum of understanding to exclusively explore the development of a DC campus in Gerbang Nusajaya.

The proposed 74-acre site in Precinct 4 could potentially support up to 360 megawatts (MW) of capacity.

UEMS’ potential involvement includes providing comprehensive construction management for long-term lease-built-to-suit developments, overseeing technical works, and handling government-related licensing, applications, and approvals.

“Details on the collaboration have yet to be ironed out, but we understand that UEMS may explore the possibility of holding a portfolio of DC assets for a recurring income stream, which could be very sizeable, given the capacity. 

“Although the plan may be limited by its balance sheet, we think the company’s upcoming non-core land monetisation could potentially bring in some financial flexibility that should help in building a DC portfolio,” it said in a note.

The research firm said that although no investment figures were provided, it estimates that this 74-acre and 360-MW capacity could bring in DC investments worth RM10 billion to RM12 billion.

“The 74 acres of land alone are worth about RM260 million, based on our conservative RM80 per square foot assumption,” it said.

Source: NST

Global data centre players to show strong interest in Gerbang Nusajaya: RHB

The focus on the development of green energy in Sarawak is to make the state a leading player in the new economy, says the Sarawak Premier.

Tan Sri Abang Johari Openg said plans to produce new energy material, and development of new infrastructure and takeover of existing infrastructure, will also bring Sarawak closer to its target of becoming a hub for Asean economic development.

“We will be the leading player of new economy, not just in Malaysia or among Asean countries, but in the world,” he said when speaking at the Gawai Ngabang programme at the Betong division yesterday.

Abang Johari said following the takeover of Bintulu Port from the Federal Government, Sarawak will develop new ports with equivalent equipment to cater to future economic development.

“We will develop what is called an Energy Hub in Samalaju and Kidurong (both in Bintulu) and will also develop the Trans Borneo Pipeline to supply gas throughout Sarawak,” he said, Bernama reported.

Abang Johari said these plans will create new job opportunities that offered high salaries to highly qualified and talented Sarawakians.

He said the people in Betong Division will not be left out of the development plan, especially in preparing the young to obtain quality higher education and talent development.

A new building will also be built in Betong as the Centre of Technical Excellence Sarawak (Centexs Sarawak), which currently is operating in a rented building.

Source: The Star

‘Be global player in green economy’

Large-scale solar ventures (LSS) will allow palm oil producers to generate up to 54 times more operating profits per hectare compared to oil palm, Maybank Investment Bank flagged.

SD Guthrie Bhd (formerly Sime Darby Plantation Bhd) (KL:SIMEPLT), Kuala Lumpur Kepong Bhd (KL:KLK), and IOI Corp Bhd (KL:IOICORP) are potential beneficiaries given their estate locations, Maybank said in a note to clients. Genting Plantations Bhd (KL:GENP), TH Plantation Bhd (KL:THPLANT) and United Plantations Bhd (KL:UTDPLT) may also benefit, it said.

“Only selected planters with the right estate location may benefit from this solar potential should they choose to capitalise on this opportunity,” Maybank said.

So far, only SD Guthrie has made public its renewable energy ambition with a one-gigawatt (GW) capacity target.

Earlier this month, Sime Darby Plantation and its major shareholder Permodalan Nasional Bhd, revealed plans to collaborate on a 1,000-acre development in the proposed Kerian Integrated Industrial Park to attract green electrical and electronics investments.

The site, located within the group’s Tali Ayer Estate in Perak, will feature solar farms owned and operated by Sime Darby Plantation. Since 2018, Sime Darby Plantation has leased a significant portion of its land for solar farms under the LSS schemes.

However, not all agricultural land may be suited for LSS, Maybank noted. Apart from flat-to-gently undulating land requirement, LSS farms are preferably located near the national grid and its interconnection points.

Maybank’s rough estimates show that 1GW capacity may bring in recurring annual income of RM134 million to RM266 million using 1,500-1,700ha of land compared to the sector’s average oil palm operating profit of RM4,444 per hectare achieved for the past 10 year.

Some planters have been leasing their land for LSS farms at double to triple the average returns of oil palm on a per mature hectare basis, Maybank noted.

“Such moves helped planters gain immediate rental returns as opposed to the typical seven-year gestation period for oil palm to generate maiden profits after replanting,” the house said.

Rather than leasing to other renewable energy companies, “it makes financial sense” for planters to be producers themselves and maximise their land values, while allowing their land to “further accrete in value when the concession ends after 20 years or so,” Maybank added.

Malaysia is pushing for renewable energy to boost economic growth as part of its climate change policy to transition away from coal and natural gas that make up the bulk of its energy mix.

Under the Malaysia Renewable Energy Roadmap, the share of renewable energy in Malaysia will rise to 40% of 18GW in 2035, of which solar will account for 7.28GW, according to the Sustainable Energy Development Authority. 

Source: The Edge Malaysia

Solar power could generate 54X more profits than palm oil — Maybank

Despite external headwinds and challenges, leasing activity for prime logistics warehouses — particularly for the Klang Valley, Johor Bahru and Penang — remained resilient in the second half of last year with expected rent growth in 2024, says Knight Frank Malaysia executive director of land and industrial solutions Allan Sim in a statement accompanying the release of Knight Frank’s Asia-Pacific Logistics Markets report for 2H2023.

He attributes this to tight availability of grade A warehouses and strong leasing demand for specific grade A warehouses as well as price resistance from landlords due to higher construction and financing costs.

“The expected global recovery in the semiconductor industry next year will increase the demand for the space, particularly in Penang, Kulim [Kedah], Melaka and Selangor. There are more high-end grade A warehouses scheduled to be completed in 2024 and landlords are increasingly reluctant to compromise on building specifications for lower rental rates,” says Sim.

“[And] as we witness a measured increase in rents, our emphasis remains on fostering innovation and sustainability in logistics spaces to meet the evolving demands of occupiers.” 

Sim also notes that the local market’s response to global economic fluctuations underscores the adaptability and forward-thinking nature of the country’s logistics industry and expects to see more landlords undertake the redevelopment of older factories and warehouses into modern warehouses with higher specifications.

“However, the performance of the rental [rates] will be subject to the performance of foreign direct investment (FDI) and domestic direct investment (DDI) in the coming year. As we navigate the path ahead, the outlook for logistics in Malaysia remains optimistic, bolstered by our resilience and strategic positioning in the Asia-Pacific landscape,” he says.

As for the larger Asia-Pacific region, the report states that the overall prime logistics rents continued their upward trajectory to grow 6.2% year on year (y-o-y) in 2H2023, powered by an acceleration in rental growth in Manila, the Philippines. It, however, shows a slowdown in short-term momentum, with a 1.5% increase in half-yearly rental growth, compared with 4.6% in 1H2023.

In the report, Knight Frank global head of occupier strategy and solutions Tim Armstrong says, “As logistics occupiers continue to dial back on expansionary ambitions, it is becoming apparent that the supply-demand imbalance that had fuelled the region’s steep rental growth is waning. However, the Red Sea conflict is a reminder that global supply chains remain vulnerable to disruptions.

“The region’s ample development pipeline is an opportunity for occupiers to review their logistics footprint. Leasing activity is expected to turn more selective with take-up from occupiers seeking strategically located prime logistics spaces that are automated and compliant with sustainability standards.”

According to the report, the region’s development pipeline will remain significant in 2024, adding 43.7% to existing stock, which will continue to ease tight supply conditions. “The bulk of new supply will be delivered in Chinese mainland markets, where over 17 million sq m completing in Beijing and Shanghai will continue to weigh on market conditions for most of 2024.”

Knight Frank head of research, Asia-Pacific, Christine Li says the impact of the considerable supply of logistics space due to the ample development pipeline and growing sublease availability will be uneven across the region. “Strong pre-commitments in Pacific markets are keeping vacancies tight while Southeast Asia and India will continue to benefit from supply chain diversification.

“In contrast, Chinese mainland markets will likely require some time to absorb a substantial pipeline given the sluggish economy. While [the] appetite for expansion among logistics occupiers has cooled, demand fundamentals in the region remain robust. Global trade and production converge in the region while the need for supply chain resilience will continue to underpin demand.”

In terms of outlook, the report states that occupiers in the region will remain cautious, impacted by a combination of economic uncertainty, inflationary pressures and higher interest rates. “Rents will remain on an uptrend, but with the structural shortage of quality spaces narrowing, growth will moderate sharply to between 1% and 3% [this year], down from the over 6% rise in 2023.”

Of the 17 Asia-Pacific cities tracked by the index, 13 recorded stable or increased rents in 2H2023 compared with 16 in the prior six months.

Southeast Asia

Average rents across Southeast Asia were mostly on an upward trend in 2H2023. Manila leads the region with 39.3% growth annually and 7.3% from six months ago, fuelled by the rapid expansion of the e-commerce sector. The report, however, notes that the pace of rent growth is anticipated to moderate as conditions normalise.

In Singapore, the recovery in manufacturing output also created conditions for higher rents during the same period. Meanwhile, those in Vietnam’s Ho Chi Minh City increased mainly due to the completion of quality logistics spaces with higher rates.

Rents in Jakarta, Indonesia, reversed a decline due to strong demographics and expanding retail and e-commerce sectors with occupiers choosing to locate closer to the capital city; whereas Bangkok, Jakarta and Kuala Lumpur saw largely stable rental levels as demand and supply remained largely in balance, the report adds.

Australia and New Zealand

Though coming off record highs, leasing activity in Australia’s Eastern Seaboard markets eased during the review period. “As a result, the pace of rental growth slowed with all markets recording increases of less than 4% from six months ago,” the report says.

However, it states that annual growth remains high with Sydney and Brisbane recording double-digit increases as incentives remained at historical lows across all capital cities. “While a strong pipeline of about three million sq m is expected to be delivered in 2024 across the east coast, the majority of this new supply has been pre-committed. Rental growth is expected to be sustainable, albeit at a slower pace, with growth expected to revert to an annual pace in the range of 4% to 8% over the next 12 months.”

In Auckland, New Zealand, the frenetic pace is also tapering off as resistance to higher rents develops in the context of weaker sentiment, which will lead to a moderation in rental growth, it adds.

East Asia

Leasing fundamentals on the Chinese mainland continued to drag against a backdrop of a weak economy and substantial completions in and around Beijing and Shanghai. “Total trade, which slowed significantly in 2023, substantially reduced the demand for logistics warehousing in the Chinese mainland. To expedite the rental process, there has been a considerable reduction in rents,” says the report.

As rents in Beijing and Shanghai softened, pressured by the abundant supply of warehouses and weakening trade, highly favourable rental rates in surrounding cities were also attracting tenants away from Shanghai and Beijing, which further reduced demand. The report says that rents are anticipated to contract in 2024 amid elevated vacancy rates.

Rents for modern logistics spaces in Hong Kong continued to register moderate growth, supported by sizeable leasing deals. “However, with substantial supply from Cainiao Smart Gateway likely to fuel an increase in vacancy rates, rents are likely to come under pressure in 2024.”

In Taiwan, market conditions continue to favour landlords. “The reshoring of technologically critical processes in Taiwan is raising storage demand for raw materials as well as semi-finished products while e-commerce companies are expanding. Robust domestic consumption, which hit a record in 2023, is fuelling demand for logistics spaces from traditional retail and e-commerce players.”

India

According to the report, the Indian warehousing market continued to reflect the strength of the Indian economy as demand remained steady in the volatile global economic environment, with 0.9 million sq m transacted in Bengaluru, NCR and Mumbai from April to September 2023.

It explains that while e-commerce companies remained focused on curbing costs, demand continued to be driven by the manufacturing and 3PL sectors. “India has benefited from the sustained move towards the decentralisation of manufacturing capacity from China.”

The real estate consultancy expects demand for logistics spaces in the country to remain robust for the rest of the fiscal year, boosted by the government’s focus on “Make in India” and the Production Linked Incentive scheme.

Source: The Edge Malaysia

Optimistic outlook for logistics space in Malaysia, says Knight Frank Malaysia

Prime Minister Datuk Seri Anwar Ibrahim has discussed investment and support plans that can be implemented by Fujifilm Healthcare Americas Corporation (Fujifilm) in the health sector in Malaysia.

Anwar, who is also the finance minister, said the session was conducted in conjunction with the courtesy visit of Fujifilm chief executive officer and president Hidetoshi Ilzawa and his delegation this afternoon.

According to him, the discussion also involved healthcare, training and the documentation of medical records.

“Today’s meeting and discussion is in line with the government’s focus on driving technological transformation, especially in the public sector,” he said through a post on X (formerly known as Twitter) today.

Fujifilm is a leading company in innovative diagnostic and imaging solutions to meet healthcare needs that span prevention, diagnosis and treatment.

Source: Bernama

PM Anwar discusses investment plans with Fujifilm