Why Malaysia’s AI future depends on building capability

 The countries that succeed in AI will be those that can independently build the infrastructure, talent and technological capabilities to innovate continuously.

Prime Minister Anwar Ibrahim at the launch of ILMU, developed by YTL AI Labs.

PETALING JAYA:

Artificial intelligence (AI) is rapidly evolving from a productivity tool into a strategic capability. The real question is whether countries will adopt AI built elsewhere, or build the capability to develop, deploy, and control AI on their own terms.

In mid-June, that question stopped being theoretical. A US export control order suspended global access to Anthropic’s Claude Fable 5 for all foreign nationals overnight, days after the model’s release, restoring access only weeks later. It is a reminder that access to AI can disappear just as quickly as it is granted.

This is the idea at the heart of sovereign AI. Often misunderstood as rejecting foreign technology, it is better understood as a country’s ability to control the components that determine whether it can keep using its own AI without depending on someone else’s permission. No nation builds every component itself, not even the US. What matters is which components it controls, and which it merely rents.

Industry frameworks such as Nvidia’s “five-layer cake” describe this: energy, data centres, cloud, foundation models, and applications.

In Malaysia, one group, YTL, has built assets across every layer, deliberately.

“AI will become one of the defining technologies of this generation, much like electricity and the internet before it.

“Building sovereign AI is not about one model or one application. It is about developing the full stack of capabilities, from digital infrastructure and cloud to foundation models and real-world applications, that allows Malaysia to innovate, compete, and chart its own AI future,” says Yeoh Keong Hann, executive director of YTL Power International Bhd.

Here is what the full AI stack looks like, layer by layer.

Energy

Energy is the foundation layer. Training and running AI models takes enormous, continuous power, and an interruption can set a training run back by days. A country that relies on external energy for its AI ambitions inherits that dependency before a single chip or model is even involved. YTL Power has spent more than three decades as an independent power producer, powering major industries, and AI is now the most demanding of them.

Data centres

Data centres are the physical facilities where that energy becomes usable compute. Where they sit determines whose laws apply to the hardware inside, and how quickly capacity can grow. YTL has built that scale at its data centre campus in Johor, which spans roughly 1,600 acres near Singapore and is scaling to 1,200MW of capacity within the same site.

This is the scale that lets the heaviest AI workloads – training and running large models for millions of users – happen domestically instead of overseas.

Cloud

Cloud is the software layer that turns data centre hardware into compute that businesses and researchers can rent, without owning or managing the machines themselves. Most countries and businesses rent this layer from a small number of foreign hyperscalers, since building it takes capital and technical validation few companies achieve.

YTL AI Cloud closes that gap for Malaysia. In May, YTL AI Cloud became among the first in Asia to reach Nvidia Exemplar Cloud status, a designation Nvidia reserves for providers meeting its highest technical bar for AI workloads. It is one of only fourteen cloud providers worldwide to achieve these standards.

The model

The foundation model is the underlying AI system supplying the intelligence. It interprets the user’s request and generates a response. If built and governed by a foreign company, its behaviour and limitations are set by that company’s priorities, usually a broad global audience, with local markets adapted in after the fact.

ILMU, developed by YTL AI Labs, was built for Malaysia, with a deep understanding of Malaysian language, culture, and context. ILMU aims to be world-class with a Malaysian advantage, ranking first in the world on the MalayMMLU benchmark, which tests academic and general knowledge across dozens of subjects in Bahasa Melayu, ahead of global models.

Foong Chee Mun, CEO of YTL AI Labs, explains the philosophy behind ILMU:

“We built ILMU on a simple belief: AI can only truly serve Malaysians if it truly understands us, our languages, our priorities, and our way of life.”

Applications

Applications are where value is created for the end user, and where intelligence, scale, and security all have to come together. In Malaysia, that convergence already exists: the capability to build autonomous AI agents, the country’s first AI-powered bank, and an AI-first telco putting AI directly into millions of pockets.

Agents are systems built around a model that let it act rather than simply answer: filing a form, processing a document, completing a transaction, without a person driving every step.

YTL AI Labs has already moved into this space with ILMU Claw, built on the open-source OpenClaw framework, letting developers and enterprises build and host autonomous AI agents on Malaysian infrastructure.

Ryt Bank, Malaysia’s first AI-powered digital bank, runs on Ryt AI, a multi-agent system built on ILMU that transfers money and pays bills from a typed request or a snapped photo of a bill. It has scaled to more than a million users in its first year, on infrastructure built in the country.

Yes began as Malaysia’s first nationwide 4G and, later, 5G operator, and is now an AI-first telco, giving every subscriber complimentary access to ILMUchat Pro and bringing ILMUchat to more than three million users. Yes also has its own AI assistant, Sofea, built directly into the MyYes app, enabling customers to check their usage and pay bills seamlessly.

Malaysia’s AI leadership

As countries compete for AI leadership, the conversation is shifting from adopting AI to building the capability behind it. The countries that succeed in AI will not simply be those that use the technology most. They will be the ones that are able to independently build the infrastructure, talent and technological capabilities to innovate continuously.

Malaysia already has that foundation. It is one of the few countries with capability across all five layers: energy, data centres, cloud, models, and applications, built by Malaysians, for Malaysian needs. That is what places Malaysia to lead the way in Asean and beyond.

The opportunity now is for every Malaysian to take hold of this and make full use of it: to work together, participate, and collaborate, across industry, academia, and government, so that Malaysia becomes an AI nation that leads the future. - FMT