Asian Infrastructure Investments Surge Amid Data Center Building Boom
Asia s in the midst of a data center building boom. Photo by Chung Sung-Jun/Getty Images.
Key Takeaways
- It is forecast that there will be nearly 3,000 data centers in the Asia Pacific region by 2030.
- Since 2022, China has invested 43.5 billion yuan ($6.12 billion) in new data centers.
- Meanwhile, Big Tech firms are building new locations in Asia’s emerging cloud markets.
According to a report by ABI Research, there are more colocation data centers in the Asia Pacific region than anywhere else—1,811 as of 2024. And with investment in the region booming, this figure is expected to rise to nearly 3,000 by 2030.
Early leaders included Hong Kong, India, and Japan, but mainland China is fast catching up, while countries like Vietnam and Thailand have only recently attracted major digital infrastructure players.
China’s $6.1B Data Center Spending Splurge
At an industry conference in Guiyang on Thursday, Aug. 28, Liu Liehong, the head of China’s National Data Bureau, said the country has invested 43.5 billion yuan ($6.12 billion) in digital infrastructure since 2022.
Domestic data centers are seen as central to the government’s plans to support homegrown innovation. Against the backdrop of increasingly severe US sanctions, they are also key to securing China’s data sovereignty and reducing the country’s reliance on foreign technology.
Dubbed “Eastern Data, Western Computing,” the project includes the construction of eight major data center hubs. These are primarily located in the west of the country, where abundant energy resources are mobilized to power the computing needs of China’s large coastal cities.
Liu said the project has already installed over 1.95 million server racks, of which about 63% are currently in use.
US Firms Remain Cautious in China
Chinese regulation and Western Big Tech firms’ reluctance to get too cozy with the government mean some of the world’s largest hyper scalers are absent from the market, which local players dominate.
For instance, AWS contracts local companies to operate locations in the country and has largely siloed its Chinese infrastructure from the rest of its global operations. Meanwhile, Google pulled its servers out of the country in 2010 because it refused to comply with the government’s content censorship.
Outside of China, however, US hyperscalers are forging ahead with new locations across Asia.
Asia’s Emerging Cloud Markets
Earlier this year, Microsoft committed to spending $2.9 billion on new cloud infrastructure in Japan, $1.7 billion in Indonesia, and $2.2 billion to launch a new Azure region in Malaysia.
In total, the firm will spend at least $6.8 billion expanding its cloud business in the APAC region over the next few years.
In Vietnam, Google is reportedly considering building a large data center in Ho Chi Minh City, a move that could spur hundreds of millions of dollars of investment in the country.
The news follows similar reports that Ali Baba is planning a major development in the country to meet the rising demand for cloud services and reduce its dependency on local operators.
For both Big Tech firms, building dedicated premises in Vietnam would help them cater to the country’s booming digital economy without violating the country’s data localization law.
Since 2022, businesses have been required to store personal data, including credit card details, email addresses, and phone numbers, on servers located in Vietnam.
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