Malaysia has the AI tools. The harder question is whether its workforce can use them

Malaysia is intensifying a five-year drive to build a national AI ecosystem, placing talent development alongside digital infrastructure, governance and industry readiness as the plan’s central pillars.

Digital Minister Gobind Singh Deo said the government has rolled out a series of policies spanning AI, energy and industrial development to prepare the country for the next wave of technological change.

“We are looking at how we can prepare our country for AI over the next 60 months. Many new policies have already been launched, including those related to energy, new industries and AI,” he said.

He said much of the groundwork is already in place. “We have the technology, we have connectivity, we have data centres, we have cybersecurity. We have also focused on talent.”

The remaining question, he said, is uptake at both the individual and organisational level. “The question now is whether every Malaysian understands how they can use this technology. The same applies to organisations.”

Gobind said Malaysia is targeting the digital economy to contribute 30% of GDP by 2030, up from 25.5% currently – making the next five years critical to strengthening the country’s AI ecosystem. He said the government has spent the past two years laying the foundations by expanding digital connectivity, developing data centres, strengthening cybersecurity and building a skilled talent pool.

His remarks coincided with a joint report by FIDE Forum and Accenture Malaysia, which found that while 71% of the banks in Malaysia have implemented at least one AI application, only 17% of financial institutions have successfully scaled strategic AI initiatives across their organisations. None of the insurers surveyed had scaled strategic AI initiatives, and no participating financial institutions had achieved full enterprise-wide integration.

The report estimated that successfully scaling AI could lift pre-tax profit at financial institutions in Malaysia by up to 16%, representing about US$1.8 billion in additional value. More broadly, it projected that AI could contribute around US$113 billion to Malaysia’s economy, equivalent to nearly a quarter of GDP.

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On AI’s impact on jobs, Gobind acknowledged that some entry-level roles may be affected, but said the government’s priority is to reskill employees rather than replace them. “We have identified the sectors that are likely to be affected over the next 60 months and are now working to ensure employees are upskilled and reskilled so they can use these new technologies to improve their jobs,” he said.

He added that the effort would extend beyond students to those already in employment. “We must also empower those who are already working. We want to develop simple, accessible AI learning modules that every Malaysian can use.”

Gobind said Malaysia’s AI governance framework is designed to complement existing industry regulators. The National AI Office (NAIO), to be institutionalised on 28 July, will lead the country’s long-term AI strategy and governance.

“The NAIO will not override existing regulators. We will work together to develop the guardrails and governance needed to ensure AI technologies are built in line with national priorities and security requirements,” he said, reported New Straits Times.