Microsoft has significantly advanced its commitment to Southeast Asia’s digital future by launching its first cloud regions in both Indonesia and Malaysia.
The announcements were made on May 27 and 28, as Microsoft hosted its AI Tour in Jakarta and Kuala Lumpur, respectively. These events attracted government leaders, tech innovators, and major enterprises, underscoring the growing importance of cloud computing and AI in the region’s economic and digital strategy.
Microsoft launches Indonesia Central cloud region
The newly launched Indonesia Central region, a high-capacity cloud hub located within the country, is designed to meet Indonesia’s data localization requirements while providing enhanced cybersecurity and improved performance for local enterprises and government agencies.
“Indonesia’s vision for AI and digital transformation requires trusted infrastructure as its foundation.” said Scott Guthrie, Microsoft’s executive vice president of Cloud & AI. “With the launch of Indonesia Central cloud region, we are bringing the full power of Microsoft cloud closer to Indonesian innovators – empowering every developer, every organization, and every government institution to innovate locally and scale globally.”
Microsoft is backing this development with a $1.7 billion investment through 2028. A broad range of leading businesses — from energy and finance to telecommunications — are already migrating to the new cloud platform. For instance, Astra International is leveraging AI to streamline operations across its motorcycle retail network.
“The presence of Microsoft’s cloud region in Indonesia reflects two key points: first, a strong confidence in the government’s digital policy direction… and second, that Indonesia is considered ready to manage advanced technologies such as cloud and AI,” said Meutya Hafid, Minister of Communications and Digital Affairs, representing the president of Indonesia.
The new data centers are strategically distributed across three zones to ensure high availability and resilience, contributing to Microsoft’s overarching goal of becoming carbon negative within this decade.
Alongside infrastructure, Microsoft is investing in people. Through elevAte, an AI-skilling initiative, Microsoft aims to train 1 million Indonesians by 2025 in collaboration with the Ministry of Communications and Digital Affairs.
Other community programs include the Nusantara Data Center Academy, where students acquire data center-related skills, and a Community Empowerment Fund, which supports schools near data centers with digital tools and training.
Microsoft debuts Malaysia West cloud region
Microsoft has also announced the launch of Malaysia West, its inaugural cloud region in the country, strategically positioned in the Greater Kuala Lumpur area. The facility is structured with three availability zones to deliver high fault tolerance and uninterrupted access to cloud services.
“With this cloud region, we can leverage the latest digital and AI technologies to move up the value chain, and the Government has set the stage, developing a world-class, trusted digital environment for businesses to thrive, aligned with Microsoft’s Trusted Cloud Principles,” YB Gobind Singh Deo, Malaysia’s Minister of Digital said in a recorded message.
This initiative falls under a $2.2 billion investment plan designed to strengthen Malaysia’s digital capabilities. Prominent companies across various sectors — including energy, fintech, and outsourcing — have already joined the ecosystem, with notable additions such as PETRONAS and TNG Digital.
“The Malaysia West cloud region will deliver world-class AI datacenter infrastructure and enable organizations to accelerate their innovation more securely – creating a future that is inclusive, sustainable, and AI-ready,” said Guthrie.
Microsoft also introduced BINA AI Malaysia, an initiative aimed at fostering national AI strategies and driving innovation. As part of this effort, it is working to establish a National AI Innovation Center in collaboration with EY Malaysia, PETRONAS, and the National AI Office.
To support workforce development, Microsoft launched AIForMYFuture, a program designed to train 800,000 Malaysians by the end of 2025. To date, 400,000 people have already acquired AI-related skills through the initiative.
The economic impact
According to an IDC report commissioned by Microsoft, the Indonesia Central cloud region is expected to generate US$15.2 billion in new economic value and create over 106,000 jobs by 2028. Meanwhile, Malaysia West is projected to contribute US$10.9 billion in new revenue and support over 37,000 jobs, including nearly 6,000 skilled IT roles.
With these two launches, Microsoft now operates over 70 cloud regions globally. The announcements signal a deliberate push to establish Southeast Asia as a critical hub in the global AI and digital economy.