Malaysia Information Technology Report Q3 2011

Malaysian IT spending is expected to grow to U$4.9bn in 2011, from US$4.5bn in 2010, when the market stabilised. IT spending should be boosted by ICT-friendly 2011 budget measures and growing interest in cloud computing, however much will depend on confidence in a sustainable economic recovery. There will be increasingly attractive opportunities in the I services area as the government implements measures to make Malaysia a regional services hub. The government has a number of initiatives with favourable implications for demand for IT products and services, including computers for education programmes.

The IT market overall has strong growth fundamentals

The IT market overall has strong growth fundamentals and key sectors will include government, telecoms and finance, including Islamic banking. The National Broadband Initiative has the potential to boost demand across all IT market segments.

Malaysia's 2011 budget contained a number of measures to boost the IT industry and help stimulate ICT adoption in the country. Key measures included a two-year extension on import tax and sales tax exemption on broadband equipment, and the establishment of the MY Creative Content programme to encourage the development of local content. The tax exemption should stimulate the purchase of various types of connectivity devices, including notebook PCs.

In H111, the Malaysian government announced a new initiative to provide every adult in the country with a free Web-based email account. The Malaysia Email' initiative, which will enable the government to deliver tax returns, court documents and other official notices online, is expected to provide a major boost to e-government development. The government will spend US$16.6mn setting up the service. Malaysia named cloud computing as the most important of its top 10 strategic innovation priorities for 2010. The government hopes that adoption of cloud computing, building on the National Broadband Initiative, could accelerate Malaysia's development into an advanced economy.