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Malaysia faces pressure to choose sides in US-China tech rivalry
Malaysia’s adviser says the country is moving toward conditional neutrality, citing tougher rules and screening for sensitive technologies amid pressure tied to its data-centre growth.
Malaysia is finding it harder to maintain neutrality as the United States and China intensify competition over trade, investment, and advanced technology, according to Tengku Zafrul Aziz, a senior political adviser to Prime Minister Anwar Ibrahim.
Aziz said Malaysia is increasingly being asked to take positions on technology security, and that companies adjust decisions based on whether Malaysia appears aligned with either Washington or Beijing.
To address the pressure, Malaysia is pursuing “conditional neutrality,” with stronger regulations, closer scrutiny of sensitive technologies, and assurances intended to prevent either side’s hardware or know-how from ending up with the other.
The issue is especially acute for Malaysia’s expanding data-centre sector, where policymakers must convince Washington that advanced US AI chips will not be diverted to China, while also reassuring Beijing that tighter controls will not be seen as choosing sides.