Malaysia's industrial sector is set to maintain its growth this year, bolstered by robust government efforts, infrastructure developments, and new industrial parks incorporating artificial intelligence (AI), as stated by Knight Frank Malaysia.

In a Thursday announcement, the real estate consultancy firm indicated that global trade tensions, especially the potential for tariff increases under President Donald Trump's leadership, might encourage manufacturers to vary their production locations, thereby reinforcing Malaysia’s status as a key industrial center.

“With geopolitical uncertainty and trade tensions expected to take centre stage in 2025, manufacturers are likely to prioritise risk mitigation, cost management, and alternative production markets,” it said.

The company highlighted that Malaysia is primed to take advantage of this transition owing to its strategic location, robust government incentives, and developing industrial environment. The Knight Frank Asia-Pacific outlook report has emphasized the increasing impact of AI and automation in influencing the industrial sector, especially in logistics, warehousing, and sophisticated manufacturing.

The incorporation of AI-driven industrial hubs is anticipated to improve operational efficiencies, predictive maintenance, and sustainability initiatives, positioning Malaysia as a desirable location for both domestic and international investors.

In the meantime, group managing director Keith Ooi stated that as Malaysia moves towards becoming a high-tech, high-value manufacturing center, the company is observing a transition towards more advanced industrial facilities that correspond with global supply chain developments.

“AI-integrated industrial parks will be a game-changer, offering enhanced operational efficiency, predictive maintenance capabilities, and optimised resource management, ultimately attracting both domestic and foreign direct investments,” he added.