Global connectivity and long-term development in Malaysia’s digitisation

INCREASING international collaboration in the digital economy will accelerate the development of the global economy.

This involves joint efforts to speed up the development of new infrastructure, global cooperation on the rise of digital industries and the digitisation of existing ones, worldwide cooperation on digital trade, deeper global cooperation on industrial and supply chains, coordinated digital and green transformation, and exploration of the potential of global collaboration in the digital economy.

For developing nations to overcome obstacles and achieve growth, effective execution of digitalisation initiatives is crucial.

These digitalisation initiatives should focus on promoting collaborative funding for development, industrialisation, developing the digital economy, and connectivity in the digital era.

S. Sanmugam, Malaysia’s chargé d'affaires in China, proposed that Malaysia and other Asean nations can profit from China's expertise in the digital economy. Sanmugam highlighted China’s ample resources allocated for research and development in this field, positioning it as a valuable source of knowledge and potential collaboration for Asean nations.

Deputy Prime Minister of Malaysia Datuk Seri Fadillah Yusof emphasised the role that sustainability and digitalisation play in propelling Malaysia’s resilience and economic success.

China has dominated as the top foreign direct investor in Malaysia, with a total investment of RM55.4bil in 2022. With a population of over 650 million, the Asean area offers a large customer base and a varied technology industry.

The Malaysian government has set up a new scheme known as Malaysia Digital (MD). This initiative aims to grow Malaysia's digital abilities, skills and increase the value of the whole digital ecosystem.

Malaysia is keen to embrace data, cloud computing and the industrial Internet. This is evident in its MyDigital Economy Blueprint, National Fourth Industrial Revolution (4IR) Policy, and plans to develop a National Robotics Roadmap.

By 2022, the development strategy is to have 80% of government data stored online. The Digital Economy Blueprint of Malaysia, introduced in 2021, outlines the nation's ambition to emerge as a prominent figure in the regional digital economy by 2030.

It underscores the importance of reassessing and modifying laws related to intellectual property, competition, and internet infrastructure to achieve its goals.

The importance of amending the Personal Data Protection Act of 2010 lies in its role in preventing the fraudulent misuse of personal data.

However, the plans China has for its digital economy are centred on data. The goal of the government’s data marketplace project is to create a market-driven pricing structure for data.

Private companies may potentially exchange data in this marketplace on a local and global scale. But this brings up issues with data governance. China passed the Data Security Law and the Personal Information Protection Law in 2021, which are laws to manage data.

The Malaysia-China Digital Economy Forum 2022 was a prime occasion for engagement between the foremost digital technology entities of China and Malaysia in the exploration of prospects arising from the digital economy, the Fourth Industrial Revolution, and sustainable development. This forum, organized by the Malaysia-China Business Council (MCBC), aimed to champion technological advancement and collaboration toward shaping the digital economy landscapes of both nations.

Integrating its digital economy with those of its foreign counterparts, China actively contributes to international digital governance.

This involvement extends to setting regulations and rules for the digital sphere. China and Malaysia have a well-established collaboration in the digital economy, characterized by close ties.

Chinese enterprises have harmoniously collaborated with their Malaysian local counterparts. The implementation and execution of numerous joint projects and programmes have garnered notable success in Malaysia, like the cloud data centre, e-commerce free trade zone and artificial intelligence industrial park.

Renowned companies such as Huawei, Tencent, Hikvision and Alibaba Cloud have unveiled their most recent technologies, products, services, and business models to emphasize the innovative digital transformation tools from China.

China enthusiastically seeks opportunities to expand its collaboration with Malaysia in emerging industries with high potential, including e-commerce, green growth, cybersecurity, and the digital economy.

Numerous Malaysian businesses are actively engaging in international partnerships, notably with Chinese entities, thanks to their abundance of local talent. With the digital landscape and economy booming, high-tech companies from China are expanding their presence in Malaysia. They are enthusiastically collaborating in multiple sectors, including the digital economy, sustainable development, and renewable energy.

Geely is set to invest a massive US$10bil to establish a state-of-the-art automotive hub in Malaysia, receiving high acclaim from Prime Minister Datuk Seri Anwar Ibrahim. Automobile manufacturers like BYD, Chery, and Great Wall, renowned for their electric vehicles, are actively entering the Malaysian market, gaining popularity and generating sales.

Additionally, telecom giants such as Huawei and ZTE are working closely with Malaysian companies to enhance the communication network, contributing to Malaysia's goal of evolving into a digital powerhouse in South-East Asia.

To foster long-term collaboration in technology and innovation between Malaysian and Chinese companies, the Malaysia-China Digital Cooperation Council (MCDCC) was established.

The Malaysia-China Digital Cooperation & Development Fund will provide investments totalling RM1 billion in Malaysian and Chinese digital technology sectors like digital applications, industrial big data, advanced manufacturing technology, industrial technology, and others.

The establishment of MCDCC and the Malaysia-China Digital Cooperation & Development Fund represents a landmark collaboration designed to bolster digital collaboration and innovation between Malaysia and China. Expanding horizons for enterprises in both nations, this strategic partnership promises to spark digital technology partnerships, cross-border ventures, and valuable investment in the thriving digital industry.

In conclusion, by working together with Chinese experts, Malaysia can strengthen its push towards becoming a digital society. Both countries stand to gain from improved ties between Malaysia and China in telecoms and the online economy. Malaysia will benefit from sharing knowledge, skills, and best practices with China. This cooperation is especially important in the build-up of Industry 4.0, the era of smart factories and automation.

Dr Cheong Jia Qi is a Senior Lecturer at University Teknologi MARA Sri Iskandar and Research Fellow at Centre for Economic Development and Policy, Malaysian Inbound Tourism Association (MITA). The views expressed here are entirely the writer’s own.

The SEARCH Scholar Series is a social responsibility programme jointly organised by the Southeast Asia Research Centre for Humanities (SEARCH) and Tunku Abdul Rahman University of Management and Technology (TAR UMT), in conjunction with the 10-year anniversary of the Belt and Road Initiative.