Broker: Maybank Research Pte Ltd
Date of Report: July 7, 2025

US AI Chip Export Curbs Threaten ASEAN Data Centre Boom: What Investors Need to Know

Overview: Rising Uncertainty for Malaysia and Thailand Data Centre Hubs

The Trump administration is preparing a new rule targeting the export of advanced AI chips to Malaysia and Thailand. This measure aims to tighten oversight on the ultimate destination of US chips, especially to prevent their indirect flow to China. If enacted, the rule will supersede previous Biden-era regulations, maintaining the established restrictions on China and more than 40 other jurisdictions.
This evolving regulatory landscape introduces fresh uncertainty for Malaysia and Thailand, both of which have rapidly become leading hubs for data centre investments in ASEAN and globally. The move could significantly impact the region’s digital infrastructure growth and its role in the global AI ecosystem.

Chinese Tech Giants: Catalysts of ASEAN Data Centre Expansion

Chinese technology firms are at the forefront of the ongoing data centre boom in ASEAN. Notably:

• Bytedance (TikTok owner): Committed to massive investments in the region, including USD 8.8 billion in Thailand and USD 2.1 billion in Malaysia to support its vast user base and comply with regional data regulations.
• Alibaba Cloud, Tencent Cloud, and Huawei: All have expanded aggressively across ASEAN to meet surging digital demand.
• DayOne: A major Chinese data centre developer, DayOne has signed a 21-year renewable energy agreement with TNB, securing up to 500 MW of solar power for its Malaysian operations.

While it’s debated whether these firms are leveraging ASEAN locations to indirectly access and run AI models using Nvidia’s advanced chips, the majority of recent data centre investments in the region are led by Chinese players.

Key Markets at Risk: Malaysia and Thailand in the Spotlight

Within ASEAN, Malaysia and Thailand have emerged as the dominant destinations for new data centre investments due to:

• Abundant land, power, and water supplies
• Robust physical infrastructure
• Favourable government regulations and support

In contrast, Singapore faces significant power and land constraints, slowing its data centre growth. Indonesia and the Philippines focus more on domestic demand, with the latter also contending with high power costs.
Maybank estimates that over 70% of new data centre investments in ASEAN—including early-stage projects—are concentrated in Malaysia and Thailand. Restrictions on access to advanced AI chips could therefore stall momentum in these countries, with ripple effects across the broader ASEAN data centre landscape.

Potential Impact: Supply Chain Companies Under Pressure

Stricter export controls could delay committed data centre builds and prompt reviews of early-stage announcements. This raises near-term demand uncertainty for several key supply chain companies:

Companies such as Gamuda, Sunway Construction, IJM, TNB, WHA, and AMATA may face immediate headwinds as clients and investors reassess project timelines and commitments.

ASEAN’s Strategic Position and Global Digital Ambitions

ASEAN is the third largest population block globally and is rapidly adopting digital infrastructure. Its favourable position offers the potential to serve broader Asia-Pacific digital needs, especially as developed markets face mounting supply constraints.
However, excluding Malaysia and Thailand from advanced US chip supply could leave a significant region outside the emerging US tech standards, potentially fragmenting the global digital marketplace.

Outlook: Too Early to Conclude, but Risks Are Rising

It remains uncertain whether Malaysia and Thailand will ultimately face severe restrictions. Should strict controls be enforced, the following impacts are likely:

• Delays in committed data centre projects
• Potential review or cancellation of early-stage investment announcements
• Increased risk to the supply chain for construction, utilities, and supporting industries

Investors should monitor regulatory developments closely, as the region’s role in global data infrastructure—and the fortunes of companies operating in this space—may hinge on the outcome of these US policy shifts.

Conclusion: Navigating an Uncertain Future

The US proposal to limit AI chip exports to Malaysia and Thailand stands to reshape the competitive landscape for data centres in ASEAN. While the region has enjoyed rapid growth fueled by Chinese tech giants and supportive regulatory environments, looming export controls could put the brakes on this momentum.
Market participants, especially those with exposure to supply chain companies and regional data centre operations, should remain vigilant. The evolving regulatory climate underscores the importance of strategic agility and proactive risk management in a sector that sits at the crossroads of technology, geopolitics, and investment opportunity.