IT operations in Malaysia could offer the near China experience

Big businesses want to get a piece of the action in China. It is the fastest growing economy and is already the second biggest behind the US.

But there are still fears about political instability and data protection which might put some western firms off a move to China. Perhaps Malaysia is a compromise because it is near but not in China. But what has Malaysia got to offer and what are its advantages?

This week I met up with one of the directors of an organisation known as MDeC, which is driving the Malaysian IT Initiative (MSC). Vijayaratnam Tharumartnam (Vijay) told me the story.

In 1996 the Malaysian government kicked of the IT initiative as part of its economic transformation. Malaysia wants to be a high income nation by 2020 and IT services have a significant role to play. The nation already has quite a strong telco sector but wants its IT sector to grow.

Vijay told me that MDeC is trying to make Malaysia the place to put your datacentres and IT operations.

Vijay says it is a good place for datacentres and IT support for a number of reasons. He says Malaysia is politically and environmentally stable. That through the MSC project foreign companies can bring all the staff they need from outside Malaysia. He also says it has data protection laws on the level with those in the West.

Add to these the tax incentives on offer, the good telco infrastructure and the large supply of English speakers and you have an option.

Malaysia currently has 0.5 million square feet of datacentres but wants to get to 5 million square feet.

Oversees companies can bring in all the staff they need unlike other nations with strict visa control.

There is already an impressive list of large western corporates using Malaysia to deliver IT to global operations in the form of companywide shared services. These include: BP, HSBC, DHL, Prudential, Dell, AIG, IBM, Ericsson, Shell, Exxon, Nokia and Standard Chartered.
IT service providers such as Wipro, HCL, IBM HP/EDS and Atos Origin have IT delivery centres in Malaysia.

What are these companies doing in Malaysia?


-BP Business Service Centre Asia

Established 2009

Operates a BPO and IT Outsourcing operations
Global Players in MSC Malaysia
-BP Business Solutions

Established 2004

Research and development of software and IT systems for the healthcare industry.


-HSBC Global Resourcing UK Limited

Established 2007

A knowledge process outsourcing centre that provisions of management and operational support for HSBC Group Service Centres worldwide.
Global Players in MSC Malaysia
-HSBC Electronic Data Processing (Malaysia)

Established 2002

A Group Service Centre (GSC) for HSBC Group which operate as a financial services processing centre, service centre, call centre and also as a contingency centre for other GSCs of HSBC Group around the world

-HSBC Software Development (Malaysia)

Established 2009
Global Players in MSC Malaysia
Information Technology Outsourcing (ITO) in software development, software deployment , software support as well as consultancy and project management


-Prudential Services Asia

Established 2003
Players in MSC Malaysia
Regional IT processing centre, regional data centre, regional shared services centre and regional customer call centre for Prudential Group in Asia.

Anyone got experience of outsourcing to Malaysia. If so your comments would be welcome.