Digital tech to modernise East M’sia’s key industries

KUCHING: Digital technologies such as artificial intelligence and data analytics are set to play a bigger role in modernising Sabah and Sarawak’s key industries, as Malaysia moves to translate its national AI ambitions into on-the-ground economic outcomes.

In an exclusive telephone interview with Borneo Post, Malaysia Digital Economy Corporation (MDEC) chief executive officer Anuar Fariz Fadzil said the shift reflects a broader push by the federal government to move from digital planning to execution, with artificial intelligence now positioned as a core economic driver rather than a future aspiration.

Under the AI Nation 2030 agenda, Malaysia is accelerating efforts to embed advanced technologies across government and industry to raise productivity, attract investment and create higher-value jobs nationwide.

Anuar stressed that the pace of global technological change means the country cannot afford to wait for trends to mature before acting.

“Readiness cannot follow innovation,” he said. “Countries that delay adoption risk falling behind economically and competitively.”

Malaysia’s digital economy is expected to contribute 25.5 per cent to national gross domestic product this year, with a target of reaching 30 per cent by 2030. The challenge now, Anuar said, is ensuring national strategies deliver measurable results across all regions, including East Malaysia.

That transition is already underway. Following the latest national development plans, early work has begun under the National AI Action Plan 2026 ñ 2030, with MDEC working alongside the National AI Office to operationalise priority initiatives.

Planning sessions and workshops have taken place in recent months, alongside engagements with state governments to assess readiness for AI-led growth and industry clustering.

At the same time, efforts are expanding to support AI adoption among micro, small and medium enterprises, strengthen industry training pathways and prepare delivery frameworks ahead of wider implementation from 2026.

For Sabah and Sarawak, the opportunity lies in applying digital technologies to sectors that form the backbone of their economies. Industries such as energy, agriculture, logistics, tourism and the creative economy stand to benefit from greater use of data, automation and intelligent systems to improve efficiency, expand market access and lift productivity.

In Sarawak, the state-led Sarawak Digital Economy Corporation has been driving digital economy implementation across sectors, from infrastructure and startup support to digital testing platforms that accelerate innovation.

The state’s digital blueprint emphasises the adoption of technologies such as Big Data, the Internet of Things and blockchain to boost productivity and attract investment.

Meanwhile, Sabah ranks second nationally in the adoption of Digital AgTech systems, with more than 70 IoT-enabled agricultural tools already implemented. AI enhancements are planned from 2025 to further improve productivity and raise incomes for agropreneurs. Beyond technology deployment, initiatives such as rural broadband expansion are improving access to digital learning tools and economic opportunities in remote communities.

“Sabah and Sarawak are active participants in Malaysia’s digital journey and have the potential to be strong contributors to the country’s next phase of growth,” said Anuar who has close personal ties to Sabah through his wife’s family.

Anuar said his personal ties to Sabah have shaped his perspective on regional development and the need for digital strategies that are grounded in local realities. He added that, when applied thoughtfully, digital technologies can help bridge gaps, raise productivity and open new pathways for growth across East Malaysia.

Within the national digital ecosystem, MDEC’s role is focused on execution. Anuar said the agency’s mandate is to translate national digital economy and AI strategies into market-facing outcomes by mobilising investments, accelerating technology adoption and enabling companies to scale.

MDEC also spearheads the Malaysia Digital status framework, which is designed to attract high-value digital investments and support companies involved in forward-looking activities such as AI, cloud computing and data infrastructure.

Early indicators suggest the approach is gaining traction. From the first to the third quarter of 2025, 402 companies were approved with Malaysia Digital status, with AI-related activities accounting for the largest share of new approvals. Collectively, these companies are projected to generate more than 22,000 jobs over the coming years, alongside cumulative revenues of RM43.5 billion and investment commitments exceeding RM54 billion.

Beyond AI, Malaysia is also preparing for the next wave of technologies expected to shape industries in the 2030s, including robotics, connected devices, blockchain, quantum computing and spatial technologies.

“Once data, compute and algorithms are embedded across the economy, they create the conditions for entirely new forms of innovation,” said Anuar.

The economic impact of these technologies, he added, must ultimately be measured through productivity gains, export growth, investment inflows and the creation of better-paying, future-ready jobs.

“The next phase of Malaysia’s digital journey will be defined by how effectively we execute,” Anuar said. “What we build today will shape our competitiveness, our industries and the opportunities available to Malaysians across all regions, including Sabah and Sarawak.”