KUALA LUMPUR: In the ever-evolving landscape of global technology, countries worldwide are racing to secure their positions in the 5G arena. Malaysia, a Southeast Asian nation with considerable potential, has recently made headlines with its decision to adopt a dual 5G network, potentially opening doors for China's tech giant, Huawei.

However, this shift in policy direction by Prime Minister Anwar Ibrahim has raised concerns about the stability of Malaysia's investment climate.

The Prime Minister's announcement that Malaysia will embrace a dual 5G network marks a significant departure from the government's previous stance. Just a few months ago, the nation had reaffirmed its commitment to a state-owned agency, Digital Nasional Berhad (DNB), to control the entire 5G spectrum.

The sudden policy reversal underscores the uncertainty that businesses and investors often face in the country.

While the idea of dual 5G networks might appear to promote competition and technological diversity, it also leaves the door open to potential security risks and foreign influence. Malaysia had initially planned to stick to its original approach, which prioritized national security and self-reliance.

The European Union and the United States had warned Malaysia about these risks, and their concerns were valid. The flip-flop in policy decisions is unsettling for investors, who seek consistency and stability when deciding where to allocate their capital.

The impact of these policy reversals on investment confidence cannot be overstated. Foreign investors look for stable regulatory environments that ensure the protection of their investments and the predictability of returns.

Frequent changes in policy, especially in critical sectors like telecommunications and technology, send a worrying signal to the global business community. They might begin to question whether their investments in Malaysia will yield the expected returns or if they should look elsewhere.

The implications are far-reaching. Malaysia has been actively courting foreign investments to boost its economic growth and technological capabilities. Such investments are instrumental in creating jobs, fostering innovation, and propelling the country towards the forefront of the global technology race.

However, a wavering commitment to a clear and consistent policy framework could deter potential investors and hinder the nation's progress.

Prime Minister Anwar Ibrahim was quoted by a Reuters report saying a switch to having a dual 5G network would allow for more effective participation by China's Huawei, providing his country with a balance of both Western and Eastern technology.

This comes after the Government has decided on a Single Wholesale Network – which was awarded to Ericsson after a competitive and transparent bidding process.

This move has sent triggers to the international investors – portraying that businesses in Malaysia are subject to high susceptibility and vulnerable to internal threats, which they do not have control over.

Moreover, the relationship with Huawei adds another layer of complexity to the situation. While the Chinese tech giant is a major player in the global 5G arena, its involvement in Malaysia's telecommunications infrastructure raises security concerns and could strain diplomatic ties with Western nations.

Striking a balance between East and West in the technology sphere is undoubtedly a complex task, but it is one that requires careful consideration and a clear, well-defined strategy.

In conclusion, Malaysia's flip-flop on its 5G policy decisions has cast a shadow over its investment climate. The lack of consistency and clarity in policy direction sends a worrying message to potential investors.

While it is essential for Malaysia to embrace technological progress and global partnerships, it should do so in a manner that prioritizes national security and provides a stable regulatory environment for businesses.

Only by achieving this balance can Malaysia truly benefit from the best of both worlds and secure its position in the global technology race.



* Rahman Hussin runs his own boutique advisory firm, Imperium Consulting and regularly shares his insights on business, trade, politics and geo-politics.

** The views and opinions expressed in this article are those of the author(s) and do not necessarily reflect the position of Astro AWANI.