Recent infrastructure expansion figures paint a compelling picture of Asia’s digital transformation. With over $31 billion flowing into Malaysia alone during the first ten months of 2024, triple the previous year’s total, and hyperscale operators committing hundreds of billions more across the broader Asia-Pacific region, capital deployment rivals some of the largest infrastructure buildouts in modern economic history.
Yet beneath headline figures lies a more complex economic narrative, one in which demographic pressures, technological adoption rates, and geopolitical considerations are reshaping how investors think about risk and return in emerging markets. Some looking to take positions in this sector could turn to financing from Equities First, which provides access to liquid capital financed against equity holdings.
Broader Economic Effects
The immediate economic impact of Asia’s data center expansion extends far beyond facilities themselves. McKinsey research indicates that demand for AI-ready data center capacity will rise at an average rate of 33 percent a year between 2023 and 2030, with AI workloads expected to account for around 70 percent of total capacity demand by 2030. Even if all currently known expansion plans are delivered on time, there could still be a data center supply deficit of more than 15 GW in the United States alone by 2030, suggesting the global supply gap could be even more pronounced across Asia-Pacific markets.
This growth trajectory suggests a fundamental shift in how digital infrastructure functions as economic infrastructure.
“What we’re seeing isn’t just technology adoption, it’s economic transformation at the foundational level,” says Al Christy Jr., CEO of alternative financing firm Equities First. “When you have mobile technologies contributing $880 billion to Asia-Pacific GDP in 2023 alone, and that figure projected to exceed $1 trillion by 2030, you’re looking at infrastructure investments that could create multiplicative economic effects,” he continued, citing data from trade association GSMA.
The underlying technical requirements help explain this demand surge. AI workloads are driving dramatic increases in power density requirements, from 8 kW per rack historically to 17 kW currently, with expectations of reaching 30 kW by 2027. Training models like ChatGPT can consume more than 80 kW per rack, while Nvidia’s latest GB200 chip may require rack densities of up to 120 kW.
The scale becomes clearer when examining specific markets. Malaysia, for example, secured over $31 billion in digital investments during the first ten months of 2024, three times the previous year’s total. This surge has positioned the country as one of Southeast Asia’s leading data center destinations, with 429MW of annual capacity additions compared to Indonesia’s 93MW and Thailand’s 31MW.
Economic implications extend beyond direct investment. In Johor, where data center capacity is on track to have at least 1.6 gigawatts from nearly nothing in 2019, making it the fastest-growing data center market in Southeast Asia, local officials report that supporting industries, from specialized construction to advanced cooling systems, have created employment opportunities across skill levels. Ripple effects include everything from increased demand for renewable energy projects to expanded fiber optic networks serving broader commercial districts.
“The infrastructure multiplier effect can be particularly pronounced in markets that were previously underserved,” says Christy Jr. “Asia-Pacific represents about 60% of the global population but only 26% of hyperscale data center capacity. That gap creates economic opportunity, but it also suggests the need for significant capital requirements.”
India exemplifies this dynamic. With just 1MW of data center capacity per million users, compared to 51MW in the United States and 4MW in China, the country faces both a constraint and an opportunity.
Boston Consulting Group’s survey of 240 senior executives across Asia and Australasia provides compelling evidence of corporate momentum towards filling these gaps: not only do more than 90% of companies plan to scale generative AI usage internally over the next two years, but mature companies in the region are already enjoying 25% shorter time-to-market with GenAI products. The survey found that in both North America and Asia-Pacific, 16% of organizations are finding proven value with AI, but APAC is investing more heavily overall. The high adoption rate, combined with AI workloads requiring 10-100 times more computational resources than traditional applications, suggests that current capacity expansion may still undershoot actual demand.
Equities First and Capital Flow Dynamics
Investment patterns emerging across Asia reveal a more sophisticated understanding of regional economic development than traditional infrastructure financing models typically accommodate. Rather than concentrating solely in established financial centers, capital is flowing toward markets that offer combinations of affordable land, reliable power infrastructure, and supportive regulatory frameworks.
Blackstone’s $14.8 billion acquisition of Sydney-based AirTrunk in September 2024 illustrates how private equity views the sector’s long-term prospects. Sean Klimczak, the firm’s global head of infrastructure, recently noted that Asia is “primed for some of the highest data center growth” globally, with Blackstone maintaining over $70 billion worth of data center assets and another $100 billion in development pipeline.
“Capital allocation in infrastructure has become increasingly nuanced,” says Christy Jr.. “Investors are evaluating not just current returns, but positioning for structural economic shifts.”
He noted that data centers are expected to consume 8% of Asia’s power by 2030, up from 4% today, excluding China. A substantial amount of capital will be needed to fuel this growth.
According to McKinsey, scaling data center infrastructure globally will require more than $1 trillion in investment across the ecosystem, with approximately 10GW of hyperscale and colocation capacity projected to break ground in 2025. By 2030, data centers are projected to require $6.7 trillion worldwide to keep pace with demand for compute power.
Traditional bank lending could struggle to accommodate these requirements, particularly in emerging markets where currency fluctuations and regulatory uncertainty complicate conventional financing structures. This gap has created opportunities for alternative financing approaches like Equities First as a means of accessing capital for infrastructure exposure.
The geographic distribution of investment also reflects changing risk assessments. Singapore’s temporary moratorium on data center construction, implemented due to resource constraints after data centers consumed 7% of the city-state’s total electricity in 2019, redirected billions in planned investment to neighboring Malaysia. The moratorium lasted from 2019 to 2022, during which Malaysia positioned itself to capture this redirected investment. The shift demonstrates how regulatory decisions in one market can create substantial economic opportunities in adjacent territories.
“Regulatory efficiency has become a competitive advantage,” says Christy Jr. “We’re seeing capital gravitate toward markets that have streamlined bottlenecks.”
Infrastructure as Economic Policy
Asian governments increasingly view data center development as economic policy, using infrastructure investment to accelerate broader technological adoption and industrial upgrading. This approach reflects lessons learned from previous infrastructure-led growth models, but adapted for digital economy requirements.
GSMA data shows mobile data traffic in Asia Pacific will quadruple between 2023 and 2030, driven by increased adoption of data-intensive content and 5G networks. Mobile internet users in APAC will grow from 1.4 billion (51% penetration rate) to 1.8 billion (61% penetration rate) by 2030, while 5G will add almost $130 billion to the Asia Pacific economy in 2030, with manufacturing benefiting most from smart factories, smart-grids, and IoT-enabled products. Supporting growth requires not just data centers, but entire ecosystems, including renewable energy generation, advanced cooling technologies, and specialized workforce development.
“Infrastructure policy has evolved beyond traditional build-and-hope models,” says Christy Jr. “Today’s approach requires coordinating power generation, telecommunications networks, workforce development, and regulatory frameworks simultaneously.”
Data sovereignty requirements add another layer of economic policy consideration. As governments implement regulations requiring local data storage and processing, they create structural demand for domestic data center capacity. The Financial Times recently reported that sovereignty concerns are accelerating construction timelines across multiple markets, as companies rush to ensure compliance before enforcement deadlines.
However, sustainability challenges could constrain future growth, prompting increased focus on renewable energy integration and advanced cooling technologies.
“The economic opportunity is undeniable, but it requires sophisticated capital allocation,” says Christy Jr. “The infrastructure buildout process involves balancing growth with sustainability constraints, all while maintaining competitive operating costs.”
For investors evaluating infrastructure exposure in this rapidly evolving landscape, specialized financial services firms that understand both traditional markets and emerging technology sectors may provide crucial access to opportunities. Those considering private credit and infrastructure financing strategies may find that alternative approaches offer the flexibility needed to navigate Asia’s complex but promising digital transformation.
