Cross-border benefits
The TPPA is also expected to provide a number of cross-border benefits in the E&E sector for Malaysia and other participating countries.
In particular, PwC noted that the TPPA would provide stronger trade secret protection and a more liberalised cross-border data flows which is expected to boost investors’ confidence to expand their high-technology manufacturing operations and research and development (R&D) investments in Malaysia.
This, in turn, is expected to translate into higher paying jobs and increase demand for knowledgedriven workforce.
“Several key E&E companies expressed that the relaxation of data localisation policies would enable them to consolidate their local data centres with their mega data centres.
“Although the local data centres that were established due to data localisation requirements tend to be smaller in scale, they generally operate with significant excess capacity and thus are more inefficient.
“The key E&E companies indicated that lower investment spending on physical facilities and the optimisation of resource utilisation across data centres would improve cost efficiency.
“In addition, savings from putting in place adequate security measures in multiple data centres would enable the key E&E companies to invest in more sophisticated security features in their mega data centres at lower cost,” PwC reported.
It added, “With the flexibility to choose the location of their mega data centres, the key E&E companies considered Malaysia to be well-positioned to become a world class data centre hub. Malaysia offers a strategic location to the high growth markets in Asia, strong infrastructure and institutional foundations at affordable cost, a vibrant E&E manufacturing hub, established business process outsourcing capabilities, and positive government support to grow the data centre industry.”
It also pointed out that the world’s leading wholesale and retail data centre service providers have already established their presence in Malaysia.
The research house further noted that more liberalised data flows would also enable greater operational efficiency in the E&E sector.