The Malaysia Digital Economy Corporation (MDEC) has praised the 2025 National Budget for its forward-thinking initiatives to accelerate digitalisation and AI adoption, which further position Malaysia as a digital leader in ASEAN. The budget’s incentives, foreign direct investments from tech giants, and support for SMEs and startups are expected to drive inclusive growth and bolster the country’s digital economy.
22 October 2024 – The Malaysia Digital Economy Corporation (MDEC) has hailed the 2025 National Budget, themed “Madani Economy: Negara Makmur, Rakyat Sejahtera,” as a progressive and forward-looking plan that strengthens the foundation of the country’s digital economy. Presented by Prime Minister Dato’ Seri Anwar Ibrahim, the budget includes significant initiatives to accelerate Malaysia’s digitalisation, foster the adoption of artificial intelligence (AI), and drive inclusive economic growth. These measures further position Malaysia as a digital hub in the ASEAN region, especially as the country prepares to chair ASEAN in 2025.
MDEC’s Chief Executive Officer, Anuar Fariz Fadzil, praised the strategic initiatives embedded in the budget, stating that Malaysia is now “future ready” to lead regional collaboration in areas such as AI, the digital economy, and innovation. He highlighted that the budget’s incentives are designed to attract both local and foreign investors, particularly in high-value sectors like digital services.
The budget also aims to empower small and medium enterprises (SMEs) with the tools needed to enhance productivity and operational efficiency, ensuring that they remain competitive in the global economy. With Digital Minister Gobind Singh Deo predicting that the digital economy’s contribution to Malaysia’s GDP will surpass 25.5% by the end of 2025, the Madani Budget 2025 underscores the government’s commitment to the well-being and prosperity of its citizens (rakyat).
A significant milestone of Budget 2025 is the successful attraction of USD 16.9 billion in foreign direct investments (FDI) from global tech giants like AWS, Microsoft, Google, and Oracle. This achievement, a result of collaboration between various ministries and agencies, including MDEC, reaffirms Malaysia’s role as a gateway for cloud infrastructure and a key player in the global digital economy. These investments are expected to generate numerous job opportunities and drive the upskilling of the nation’s workforce.
On the AI front, the government has allocated RM10 million to the National AI Office and RM50 million for AI education, illustrating its commitment to developing Malaysia’s AI capabilities and creating a skilled talent pipeline. Anuar also highlighted the importance of ethical AI development and Malaysia’s leadership in the ASEAN AI Safe Network initiative, ensuring responsible AI practices across the region.
Additionally, the Digital ID initiative is set to enhance digital trust and security by providing businesses and the rakyat with a reliable online identity verification system. This will reduce fraud and strengthen the overall digital economy.
The budget also includes RM1 billion for the National Fund-of-Funds and another RM1 billion for the Pioneer Fund by KWAP, aimed at supporting Malaysia’s startup ecosystem. MDEC welcomes the RM65 million boost for Cradle Fund and the RM15 million matching grant to encourage collaboration between government-linked companies (GLCs) and startups, further nurturing Malaysia’s “culture of innovation.”
MDEC’s Founders Centre of Excellence (FOX) programme continues to empower local startups, with the Prime Minister highlighting the success of Vitrox Berhad, a global player in the electronics industry, as an example of the positive impact of such initiatives.
In conclusion, MDEC stands ready to support these transformative initiatives and will continue to work closely with entrepreneurs, businesses, and communities to ensure that Malaysia’s digital economy thrives, creating opportunities for all.
