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Malaysia's Minister of Investment, Trade and Industry Datuk Seri Johari Abdul Ghani acknowledged on Thursday that some companies had rented space in Malaysian data centers to import GPUs legally, which they then shipped abroad in smuggling operations. To prevent such practices, Malaysia's Digital Ministry is now reviewing existing legislation to determine whether local authorities can take action against entities that re-export processors subject to U.S. export bans. The minister stressed that Malaysia wants AI accelerators imported into the country to be used domestically.
The proposed legislation will require data center operators to disclose the number of GPUs they import, their power consumption (presumably nameplate power consumption), the physical locations of their facilities, and the identities of operators and hyperscale customers. The government intends to track data center operations throughout their lifetime rather than limit oversight to the project approval stage.
Meanwhile, data center operators will have to pay for all the electricity capacity they reserve, irrespective of their actual power consumption. For example, if a data center secures 100 MW of power capacity but only uses 50 MW, its operator will still have to pay for the remaining 50 MW. The measure is meant to discourage companies from reserving electricity capacity they may not need for another one to three years. As an added bonus, the measure will further discourage rerouting AI hardware to China while pretending it is used in Malaysia.
While data on power consumption could help Malaysian authorities spot suspicious discrepancies between AI GPU imports and actual data center operations, it is virtually impossible to accurately determine the number of AI accelerators deployed at a facility based on power consumption alone. For example, Nvidia's H100 and H200 SXM GPUs are rated at 700W, whereas its B200 SXM accelerators are rated at 1,000W, yet neither necessarily consumes its rated power under actual workloads.
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Key considerations
- Investor positioning can change fast
- Volatility remains possible near catalysts
- Macro rates and liquidity can dominate flows
Reference reading
- https://www.tomshardware.com/tech-industry/artificial-intelligence/SPONSORED_LINK_URL
- https://www.tomshardware.com/tech-industry/artificial-intelligence/malaysia-plans-new-law-using-data-center-power-consumption-to-catch-ai-gpu-smugglers-but-real-world-tdp-variance-and-lack-of-physical-audits-could-undermine-it-new-law-also-forces-operators-to-pay-for-unused-electricity-capacity#main
- https://futureplc.com/privacy-policy/
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Informational only. No financial advice. Do your own research.