“Equinix says Johor is emerging as the preferred alternative for data centres as Singapore faces expansion limits, positioning Malaysia as a key digital infrastructure hub in Southeast Asia.“
Kuala Lumpur, 08th May 2025, 01.26pm – As Singapore faces physical constraints in expanding its digital infrastructure, Malaysia—particularly Johor—is rapidly becoming a key destination for global data centre investments, according to Equinix Malaysia.
“Singapore has essentially reached its physical limits for data centre expansion,” said Cheam Tat Inn, Managing Director of Equinix Malaysia, during a media tour of the company’s Kuala Lumpur data centre (KL1) on Wednesday.
“The demand for digital infrastructure hasn’t slowed down. Companies still need scalable capacity, and Johor offers the proximity and network connectivity to meet those needs,” Cheam explained.
Johor: Southeast Asia’s Next Digital Infrastructure Hub
The shift to Johor is driven by its geographical advantage, low-latency cross-border connections with Singapore, and lower operating costs—making it an increasingly attractive alternative for hyperscalers, tech giants, and cloud service providers.
Cheam noted that Malaysia is uniquely positioned with three major digital pillars: data centres, artificial intelligence (AI), and semiconductors—making the country “one of the few in the region capable of supporting full-spectrum digital transformation.”
“This gives Malaysia a strategic edge in enabling digital infrastructure to support the region’s fast-growing digital economy,” he added.
Singapore’s Tight Quota Fuels Malaysia’s Rise
Singapore’s data centre boom stalled after the city-state introduced a moratorium in 2019, halting new developments due to sustainability concerns. Although the government lifted the freeze in 2022, it imposed a strict cap of 60 megawatts (MW) per year for new builds—severely limiting expansion.
This policy shift has prompted global players to seek alternatives across the border, with Johor emerging as a natural extension of Singapore’s digital corridor.
Malaysia Poised for Continued Data Centre Growth
Malaysia’s data centre momentum has been accelerating since 2022, bolstered by government-led initiatives under the Malaysia Digital Economy Blueprint (MyDIGITAL) and robust demand from regional enterprises.
Cheam said he remains bullish on Malaysia’s digital infrastructure prospects, especially as the government aims to establish the country as a regional digital economy powerhouse.
“The commitment is there—from both the public and private sectors—to build the necessary infrastructure. As long as that continues, we see sustained growth in the Malaysian data centre market,” he said.
Equinix, one of the world’s largest digital infrastructure providers, opened its first Malaysian data centre (KL1) in 2023, with plans to expand operations to Johor in the coming years.
