Budi Arie Setiadi, Indonesia’s communications and information minister, said Wednesday that multinational technology companies, such as Google and Microsoft, favor Malaysia than his country for data center locations.

This preference stems primarily from Malaysia’s advantageous electricity costs and fiscal incentives.

Budi said electricity in Malaysia costs around 8 US cents per kilowatt-hour (kWh), compared to Indonesia’s rate of 11 to 12 cents per kWh.

Moreover, Malaysia provides substantial tax exemptions for capital investment and assurances that create a more stable environment for foreign investors.

Indonesia’s data center investments are projected to reach merely US$634 million, contrasting with Malaysia’s.