Energy & industrial strategy
East Malaysia’s industrial shift: from a region once regarded as peripheral to a strategic node in the global energy transition.
While much of Malaysia’s economic attention has traditionally centred on Kuala Lumpur, Penang and Johor, a significant shift is taking place in East Malaysia. Sarawak, long regarded as less developed compared to its western counterparts, is rapidly positioning itself at the forefront of the global energy transition. At the centre of this transformation is its growing leadership in green hydrogen.
For decades, Malaysia’s economic narrative has been heavily focused on the west coast. That framing left East Malaysia treated as peripheral, even as hydrogen became a recognised pillar of global decarbonisation in energy-transition frameworks published by institutions such as the International Energy Agency.
01
A Scale That Rivals Global Projects
Sarawak’s progress is not limited to planning or announcements. Its green hydrogen initiatives, particularly in Bintulu, are designed to produce approximately 240,000 tonnes of hydrogen annually, based on publicly announced project capacities by Sarawak state authorities and project partners.
That places the state ahead of Saudi Arabia’s flagship NEOM hydrogen project, which is projected to produce around 219,000 tonnes per year according to project disclosures associated with the NEOM Green Hydrogen initiative.
240kt
Annual design capacity
219kt
NEOM project comparison
02
Direct Foreign Investment into East Malaysia
Major multinational corporations, including Samsung, POSCO and Sumitomo Corporation, have established partnerships and signed agreements directly in Sarawak, as reported in regional investment and project announcements, particularly in Kuching and Bintulu. Global capital is increasingly directed towards regions with strategic resource advantages and long-term policy alignment.
03
Bintulu’s Rising Global Recognition
Bintulu has been included in global industrial discussions alongside major economic centres such as New York, Rotterdam and Shanghai, as reflected in international industrial and energy transition platforms including those associated with the World Economic Forum. The city is no longer viewed as a peripheral location, but as a relevant node within global industrial and energy networks.
04
Early Implementation of Hydrogen Infrastructure
In Kuching, hydrogen-powered buses are operating on public roads, supported by dedicated refuelling infrastructure, as part of pilot initiatives led by Sarawak state agencies and energy partners. The region established one of Southeast Asia’s earliest hydrogen refuelling stations, based on early-stage hydrogen mobility initiatives implemented in Kuching, at a time when many regional capitals had yet to formalise hydrogen strategies.
05
Strategic Importance in the Energy Transition
Hydrogen is increasingly viewed as a key component in global decarbonisation efforts, a position widely recognised in energy transition frameworks by organisations such as the International Energy Agency. It plays a critical role in three areas that will shape industrial and energy systems over the coming decades:
Reducing industrial emissions
Supporting renewable energy storage
Enabling cleaner transport systems
06
A Shift in Malaysia’s Economic Centre of Gravity
When discussions arise around the future of energy, industrial transformation and sustainability, the Malaysian location increasingly entering those conversations is Bintulu, rather than the country’s traditional metropolitan centres.
Regions able to develop hydrogen production capacity, infrastructure and export capability at an early stage are likely to hold a long-term strategic advantage. Sarawak’s investments suggest a clear intention to occupy that position within Southeast Asia. Regions without that early capacity risk missing it.
07
Structural Advantages Driving Growth
Sarawak’s hydrogen programme is underpinned by conditions that collectively enable faster project execution and long-term scalability:
Access to natural resources suitable for renewable energy generation
Strong state-level policy direction and continuity
Availability of land for large-scale industrial development
Lower levels of congestion compared to major urban centres
08
A Shift Already Underway
Sarawak’s emergence as a hydrogen hub reflects a broader shift in how and where future industries are being built. What was once considered a peripheral region is now attracting global capital, international partnerships and strategic attention.
In the context of the global energy transition, Sarawak is no longer catching up. It is positioning itself at the forefront.