KONTAN.CO.ID - KUALA LUMPUR. Microsoft Corporation will invest US$ 1 billion over the next five years in Malaysia as part of a new partnership programme with government agencies and local companies, the Southeast Asian nation's prime minister said on Monday.

The announcement on what would be the U.S. tech giant's biggest investment in Malaysia comes after the country in February gave conditional approvals for Microsoft, Google , Amazon and state telecoms firm Telekom Malaysia to build and manage hyper-scale data centres and provide cloud services.

It also comes after the country saw foreign direct investments (FDI) plunge by 68% last year, the biggest decline in Southeast Asia.

Malaysia has defended itself as an investment destination, with the finance minister recently saying it was looking at incentives to help attract more FDI.

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It has said the investments from these cloud service providers will total between 12 billion ringgit and 15 billion ringgit ($2.91 billion-$3.64 billion) over the next five years.

As part of the Bersama Malaysia initiative, Microsoft will establish its first "datacentre region", which consists of multiple data centres, in Malaysia to manage data from various countries, Prime Minister Muhyiddin Yassin told an event marking the launch of the programme.

"The upcoming datacenter region will be a game-changer for Malaysia," Microsoft Executive Vice President Jean-Philippe Courtois said in a statement, adding it will enable the government and businesses to "transform" their operations.

Under the programme, Microsoft will also assist up to a million Malaysians in getting digital skills by the end of 2023. ($1 = 4.1260 ringgit) 

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Editor: Herlina Kartika Dewi