Keynote Speech at Catalyst Series: “Transforming the Global Digital Economy with Generative AI”
Generative AI: Cusp of a New Era for the Malaysian Economy
Speaker: Yang Berhormat Datuk Wilson Ugak Anak Kumbong, Deputy Minister of Digital of Malaysia
Location: Kuala Lumpur Delivered: 30 July 2024
Full Speech:
Salam Malaysia MADANI and good morning to everyone,
I am honoured to be here at the second installation of the Catalyst series today organised by the Securities Commission in collaboration with its Venture Capital industry partner, The Hive.
This is a great initiative by the Securities Commission to cultivate connections and peer sharing within the corporate community and thus, I am glad to see so many diverse corporate faces in attendance here today looking to explore how they can leverage corporate innovation to drive growth and foster important connections.
Today’s event is entitled “Transforming the Global Digital Economy with Generative AI”, and it is most timely seeing how Malaysia is emerging as a hotspot in the global AI supply-chain.
The SC’s co-organiser, The Hive, based in Silicon Valley as well as their local partner, The Hive Southeast Asia are also well-placed, as they have been investing in the ongoing generative AI-powered inflection sweeping the global economy.
Ladies and Gentlemen,
The unprecedented disruption caused by the COVID-19 pandemic unwittingly drove the innovation engine due to accelerated digitisation of life, work and governance.
While the outbreak caused significant disruptions to commercial operations and business relationships around the world, it also uncovered hidden talents and capacity to learn and adapt ideas to local needs.
Artificial intelligence or AI has emerged at the forefront of this digital revolution as a driving force behind technology-driven transformation of the Malaysian economy. AI is playing an essential role in bolstering Malaysia's economic growth and building new digital talents ensuring stability and competitiveness for all Malaysians. A McKinsey-led study in 2018 indicated that AI can add about 1.2% growth to our economy over and above the baseline of 4.5%-5% rate.
AI has undergone a paradigm shift in the past 6 years driven by fundamental research at Google, OpenAI and NVIDIA leading to the development of generative AI. As we are experiencing with consumer tools like ChatGPT, this technology has advanced to become ready for mainstream adoption.
AI has transitioned from a mere topic of research into that of large-scale engineering and applications. Much like electricity or the Internet, this brings sweeping changes to all aspects of the global economy including commerce, media, enterprise operations, financial services, healthcare and even governance.
Generative AI has already seen broad-scale adoption by leading enterprises in all these verticals. Singapore announced a US$ 743M investment plan on generative AI in their 2024 budget over the next 5 years.
Our Government has seized this opportunity and is working hard to transform Malaysia into a global AI powerhouse. We are realising this goal by simultaneously building:
AI talent
AI infrastructure; and
Global leadership in the AI supply chain.
AI Talent
Malaysia is in a great position to build nationwide AI talent; for both improving the quality of the lives of fellow citizens and leading the world in generative AI driven innovation. Malaysia’s AI talent is being developed through three work types of initiatives supported by the Government – skills-building, AI R&D and entrepreneurship.
AI skill-building is scaling up through several initiatives like the Gamuda AI Academy (in partnership with Google), AI Nusantara (co-created by SIDEC and The Hive Southeast Asia in partnership with Huawei), to name a few.
The Malaysian Government is committed to grow Malaysian R&D to 3.5% of the national GDP by 2030 making it on par with nations like South Korea, Japan and Singapore. AI R&D is a key driver for reaching this goal.
Malaysia is the 3rd largest ecosystem in SE Asia. We are gearing up towards becoming one in the Top 20 global startup ecosystems by 2030. Entrepreneurship is a great avenue for AI talent-building as it incentivises innovation and attracts founders from diverse backgrounds to apply AI in their respective domains.
AI Infrastructure
Generative AI consumes AI computing powered by GPUs chips for both training AI models (like GPT) and applying pre-trained AI models to generate outcomes from data. AI computing is offered in data centres connected to the electricity grid and telecommunication networks. This AI computing has become a national resource that Malaysia needs to fuel its AI-led economic growth.
The Malaysian Government has led a historic build-out of AI computing capacity over the past 18 months in partnership with global leaders like NVIDIA, Microsoft, Google and AWS. The current AI computing projects bring over 1000 exaflops of AI computing capacity in the next 2 to 3 years.
JP Morgan recently upgraded their outlook on the Malaysian economy stating the monumental build-out of AI computing capacity as one of the main reasons. Malaysia is the fastest growing data centre market in Southeast Asia owing to its talent, geographical location (especially in the semiconductor supply chain), and energy resilience. Global leaders opine that Malaysia is the most strategic location for building data centre capacity.
Global Leadership in AI supply chain
Being an early mover in the generative AI-led economic transformation, Malaysia can become a global leader in the AI supply chain. A global leadership will propel the AI-led growth in the Malaysian economy much beyond the 1.2% McKinsey estimates.
It enables Malaysians to become globally competitive and secure high-skill jobs, and fortifies Malaysia’s influence in the emerging world order built over access to both AI and energy.
Malaysia is in a strong position of advantage in building three layers of global AI leadership stacked up on each other: infrastructure, talent, and innovation.
Infrastructure Leadership
Malaysia has had a strong start with the buildout of AI computing data centres with over USD 20 billion committed investments over the next 2 to 3 years. We need to build on this momentum and offer developer-friendly access to AI computing for efficient utilisation of this resource. Generative AI has made AI computing a global commodity.
Malaysia has the key strategic advantage of efficient energy and an electricity grid under massive transformation. This puts Malaysian AI computing as one of the most energy and cost efficient in the world.
Malaysia has the opportunity to become a leading supplier of AI computing across the world. While inferencing on data might be sometimes time latency sensitive, training AI models can consume AI computing from anywhere in the world. However, we need to build corridors with a global trade ecosystem of startups and enterprises for exporting AI infrastructure.
Talent Leadership
Building on the access to AI computing and partnerships with global AI leaders, Malaysia has the opportunity of becoming a global leader in AI talent. We have had a great start with the number of AI academy initiatives that I listed earlier. However, to stay globally competitive, Malaysian engineers need to participate in the most advanced generative AI R&D projects across the world. The two drivers of AI R&D are enterprises and startups. Malaysia needs such a global R&D ecosystem of such global enterprises and startups to invest in developing and retaining AI talent from Malaysia.
Innovation Leadership
Building on the AI infrastructure and talent, Malaysian entrepreneurs and enterprises have the opportunity to address global markets with new innovations built on generative AI. Malaysia is renowned for its innovations across agriculture, construction, energy, healthcare, media and telco. Generative AI has much to offer in amplifying these innovations to a global scale.
We have seen this play out in Japan, China, India and South Korea in the past decades. Malaysia must seize this opportunity to address markets beyond Southeast Asia with its innovative applications of generative AI across different industry verticals. This needs the development of a global innovation ecosystem that provides Malaysian entrepreneurs & enterprises access to Western markets.
I invite you all to participate in building these key global ecosystems for driving Malaysia’s leadership in innovation, talent and AI infrastructure. We must make this platform a launchpad for ushering a new era of the Malaysian economy. I welcome each and every one of you from this group of entrepreneurs, investors and corporate leaders to participate actively in our AI-led nation-building journey.
To conclude, the Ministry of Digital is open to engagement and in particular, private-public collaborations to drive progress and transformation through innovation, in our efforts to create a digitally-savvy society and a prosperous digital nation.
The Securities Commission Malaysia (SC) was established on 1 March 1993 under the Securities Commission Act 1993 (SCA). We are a self-funded statutory body entrusted with the responsibility to regulate and develop the Malaysian capital market.
