Malaysia's sovereign wealth fund Khazanah Nasional Bhd is making strategic moves to harness the artificial intelligence revolution. The fund's managing director, Amirul Feisal Wan Zahir, revealed these plans during an interview at the World Economic Forum in Davos, Switzerland.
Focus on Energy and Computing Power
Amirul Feisal emphasized that AI's explosive growth depends heavily on computing power, which in turn requires massive energy supplies. He stated that Khazanah will channel more capital into strengthening Malaysia's power system and ensuring grid resilience. This focus on infrastructure aims to provide cheap and reliable electricity, including from renewable sources, as AI infrastructure scales up globally.
"What it does need is computing power and what computing power means energy. So that's when we think about capturing some of that growth," Amirul Feisal told Reuters.
Supporting Local Semiconductor Firms
While many global investors pour money into data centers, Khazanah is taking a different approach. The fund plans to help Malaysian semiconductor companies move up the value chain into advanced packaging. This strategy aligns with the government's broader industrial policies to strengthen Malaysia's position in the global chip supply chain.
Prime Minister Anwar Ibrahim announced in May 2024 ambitious targets for semiconductor investment. The government aims to attract at least 500 billion ringgit ($123.40 billion) in this sector, supported by substantial fiscal incentives. Building local capabilities in chip design and advanced packaging remains a key priority.
Khazanah's Growing Portfolio and Financial Strength
Khazanah invests both in Malaysia and internationally across various markets and asset classes. Its portfolio includes significant holdings such as CIMB Group, Malaysia's second-largest lender, and Malaysia Aviation Group, the national carrier. The fund's net asset value showed impressive growth, rising 22% to 103.6 billion ringgit ($25.57 billion) in 2024 from 84.8 billion ringgit the previous year.
Amirul Feisal expects Khazanah's international portfolio share to increase gradually over time. When asked about the Malaysian ringgit, he noted there is "room" for the currency to strengthen, depending on U.S. dollar movements and uncertainty surrounding U.S. interest rate paths. However, he did not specify any particular target level for the ringgit's appreciation.
The fund's strategic investments in energy infrastructure and semiconductor advancement position Malaysia to compete effectively in the rapidly evolving AI landscape. These moves demonstrate how sovereign wealth funds can drive national economic transformation through targeted capital allocation in critical technology sectors.
