Building the digital infrastructure for an AI-ready Asia

28 May 2025

Despite having two-fifths of the world’s population, Asia has less than 30% of data center capacity, measured by power consumption.^[1] A wide variety of financing will be required as Asia improves its digital infrastructure in the coming years.

At a time of near-term uncertainty, with questions over the future of global trade and manufacturing, Asia’s digital infrastructure is emerging as a long-term asset class that offers protection from inflation and relatively low exposure to international policy surprises.^[2] Securities-backed finance can be one way for long-term shareholders to access this investment theme.

Globally, major cloud-service providers, smaller tech firms, telecoms providers, big enterprises and data-center operators spent US$465 billion on data center infrastructure last year.^[3] Global data center capacity is expected to more than triple from approximately 60GW to 219GW by 2030.^[4]

The pace of growth in Asia is even faster, with mobile-data traffic in Asia expected to quadruple by 2030, according to GSMA, a trade body.^[5]

Increased demand for digital services by Asia’s growing middle class is already leading to the build-out of digital infrastructure attracting some of the world’s biggest tech companies – and many of the most sophisticated investors. Increased adoption of artificial intelligence technologies will add a further boost.

AI-driven data centers turbocharge existing growth

Asia’s digital expansion relies on multiple factors: rising data consumption, AI adoption and data sovereignty concerns.

Cloud computing and e-commerce are booming across the region. Gross market value (GMV) of Southeast Asia’s digital economy, for example, has doubled from US$102 billion in 2019 to US$219 billion by 2023, with e-commerce accounting for the greatest share of that value.^[6]

Big technology firms like Google, Amazon and Alibaba have earmarked billions of dollars of investment to meet the growing demand for digital services in the region.

But this could be only the start. In a recent survey of 240 senior executives across Asia and Australasia, Boston Consulting Group found that more than 90% of companies in the region are planning to scale up generative AI usage internally over the next two years, with the technology helping them both manage costs and lift revenues.^[7] Data center operators are therefore confident of strong demand. With the proliferation of hyperscale data centers, which require millions of square feet, Asia’s high number of second-tier metropolitan cities with lower costs for land and labor stand to benefit.

The economic transformation due to data center build-up can be seen most clearly in Malaysia, which took top spot for data center investments in Southeast Asia last year. With operational capacity more than doubling in 2024, it was the fastest-growing market in the region.^[8] Much of the growth has taken place in Johor instead of Kuala Lumpur with the province on track to have at least 1.6 GW of data center capacity built over just six years.^[9]

Other promising markets include India and Japan, both of which account for a fifth of the region’s total under construction and planned capacities.^[10] India will need to build data center capacity quickly to meet fast-growing digital consumption – the country has just 1MW of data center capacity per million users, compared with 51MW in the US and 4MW in China.^[11]

A growing focus on data sovereignty will also accelerate data center construction in individual markets.^[12]

Beyond data center firms, there are also multiple routes for investors looking to take a view on this long-term trend. Asia’s digital build-out will create opportunities for hardware suppliers, from chips to networking equipment, and for the power sector. Excluding China, data centers are expected to consume 8% of Asia’s power by 2030, up from 4% today.^[13] Green energy will be especially sought after as tech companies push for ways to reduce their carbon footprint.

For investors looking to take a view on this long-term trend, securities-backed financing can provide a flexible and affordable source of capital for investments in what are irreplaceable, essential and long-life assets with high barriers to entry that support a variety of institutional and societal needs.

[1] https://www.economist.com/business/2025/02/05/the-data-centre-investment-spree-shows-no-signs-of-stopping

[2] https://asia.nikkei.com/Business/Finance/Asia-primed-for-some-of-highest-data-center-growth-Blackstone-infrastructure-head

[3] https://www.economist.com/business/2025/02/05/the-data-centre-investment-spree-shows-no-signs-of-stopping

[4] https://www.mckinsey.com/industries/technology-media-and-telecommunications/our-insights/ai-power-expanding-data-center-capacity-to-meet-growing-demand

[5] https://www.gsma.com/newsroom/press-release/asia-pacifics-mobile-economy-forecast-to-grow-to-1-trillion-by-2030-as-5g-technologies-accelerate-regions-digital-transformation/

[6] https://web-assets.bcg.com/8b/c0/4ae607944bdd8d83068cfef87e31/accelerating-compute-needs-underpin-sea-dc-growth-vfinal.pdf p.3 BCG (Oct 2024)

[7] https://www.bcg.com/publications/2025/generative-ai-adoption-in-asia

[8] https://cushwake.cld.bz/asiapacificdatacentreupdateh22024-02-2025-apac-regional-en-content-datacentres/2/ p.2 Cushman and Wakefield (Jan 2025)

[9] https://apnews.com/article/malaysia-johor-data-centers-energy-electricity-power-cfb087f755d3e203a347463af229e88d

[10] https://cushwake.cld.bz/asiapacificdatacentreupdateh22024-02-2025-apac-regional-en-content-datacentres/2/ p.2 Cushman and Wakefield (Jan 2025)

[11] https://www.ft.com/content/7f4aff43-b181-4965-96bc-420d502673ad?

[12] https://www.ft.com/content/a2b5cfae-c911-47d8-8fc9-9ef91aef082b

[13] https://www.economist.com/asia/2024/10/10/asia-is-weighing-data-centre-ambitions-against-sustainability

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