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According to McKinsey, traditional compute, storage, and cloud workloads currently account for more than 70% of APAC data center demand, while AI training and inference workloads represent roughly 30%
In sum – what to know:
Regional growth engine – Asia-Pacific could account for 34% of global data center demand by 2030 as local AI adoption and enterprise digitization accelerate, according to McKinsey.
Demand diversification – AI workloads are expected to represent roughly half of APAC data center demand by 2030, up from about 30% today.
Sovereignty reshapes market – National AI strategies, sovereign infrastructure initiatives and localization efforts are reshaping investment patterns and supply chains across the region.
Asia-Pacific is emerging as the next major engine of global data center growth, with the region expected to account for roughly one-third of worldwide demand by 2030 as local AI adoption, enterprise digitization and sovereign technology initiatives gather pace, according to a new report by McKinsey.
The consulting firm estimates that APAC could represent approximately 34% of global data center demand by the end of the decade, second only to North America, which is expected to account for around 46% of total demand.
The report, “Beyond the spillover: Asia–Pacific, the next engine of data center demand,” argues that the APAC region is evolving from a market largely absorbing excess demand from Western hyperscalers into an independent growth engine fueled by domestic AI adoption and digital transformation initiatives.
“APAC is emerging as a demand market in its own right,” McKinsey said. “Rather than simply absorbing spillover from the West, it is building its own growth engine.”
According to the report, traditional compute, storage, and cloud workloads currently account for more than 70% of APAC data center demand, while AI training and inference workloads represent roughly 30%. However, that balance is expected to shift significantly over the coming years, with AI and traditional workloads reaching an approximately 50-50 split by 2030.
McKinsey noted that growing AI adoption across sectors including manufacturing, retail, and financial services is creating a more durable and diversified demand profile for data center capacity across the region.
The firm estimates that leading Western hyperscalers and cloud providers — including Amazon Web Services, Google, Microsoft and Oracle — committed more than $160 billion between January 2024 and May 2026 to expand AI infrastructure across APAC.
At the same time, Asian technology companies are rapidly increasing investments in AI infrastructure. McKinsey highlighted Alibaba’s commitment to invest at least $52 billion in cloud and AI infrastructure over three years, while ByteDance could spend approximately $30 billion on AI infrastructure in 2026 alone.
Mainland China is expected to remain the region’s dominant market, potentially accounting for more than 70% of APAC data center demand by 2030, equivalent to approximately 58 GW of capacity.
However, growth outside mainland China is also accelerating. McKinsey identified emerging infrastructure corridors in Johor, Malaysia; Chonburi, Thailand; Jakarta, Indonesia; Mumbai, India; and Osaka, Japan, driven by a combination of Western hyperscaler expansion, investments by Chinese cloud providers and national digital sovereignty agendas.
According to the report, sovereign AI initiatives are becoming increasingly important demand drivers. Countries including Singapore and Japan are investing heavily in domestic AI capabilities and infrastructure to strengthen technological independence and accelerate AI adoption.
McKinsey also noted that mainland China’s data center ecosystem is increasingly localizing across the technology stack, from cooling and power systems to networking equipment and AI chips, supported by national policy, capital investment and supply chain resilience initiatives.
Nevertheless, the report emphasized that China’s market remains selectively open to international capital and technology providers, particularly in segments where performance, efficiency, and reliability remain key purchasing criteria.
The report’s findings are broadly consistent with what data center operators are already seeing on the ground. In a recent interview with RCRTech, Jeremy Deutsch, president of Asia-Pacific at Vantage Data Centers, said the rapid expansion of AI workloads is reshaping infrastructure requirements across the region.
“The density of the racks, the amount of power they’re drawing is higher,” Deutsch said, noting that AI training and inference workloads are driving demand for higher-capacity facilities, new cooling technologies and larger deployments.
Deutsch also highlighted growing opportunities in markets such as Australia, Japan, and Malaysia — countries identified by McKinsey as emerging data center growth hubs. “We certainly see great opportunity in markets like Australia, in Japan, in Malaysia to deploy infrastructure to support this new wave of data centers,” he said.
Globally, McKinsey estimates that approximately $6.7 trillion in cumulative investment will be required across the data center value chain between 2025 and 2030 to meet accelerating demand for AI and digital infrastructure.
