Johor

Johor, Malaysia's southernmost state, halted Tier 1 and Tier 2 data-centre approvals in late April 2026 following what The Diplomat described as Malaysia's first water-rights protest against data-centre development. Applicants are being told to wait until mid-2027 for new water connections, according to reporting by the South China Morning Post. The moratorium covers the Iskandar Malaysia development zone adjacent to Singapore, which had been aggressively courted as a low-cost alternative to Singapore's own data-centre capacity restrictions.

Johor had attracted significant data-centre investment from operators displaced by Singapore's moratorium on new data centres (lifted in 2022 but still capacity-constrained). The state offers lower land and electricity costs, access to Singapore's fibre infrastructure via the Causeway crossing, and proximity to Southeast Asia's largest internet exchange. Its water infrastructure, however, was not scaled for hyperscale data-centre water consumption — particularly cooling towers drawing millions of litres per day from the Skudai and Johor river systems.

The pause aligns Johor with a global pattern in which water-use objections have become the second-tier consent problem after electricity. Malaysia as a whole has positioned data-centre development as a major FDI priority — the government reported over 50 billion ringgit in DC investment pledges in 2024-2025 — making Johor's water-linked freeze politically as well as operationally significant.