Malaysia's government-linked investment companies have dramatically accelerated capital deployment into the domestic economy, channelling RM20.3 billion in 2025 as the GEAR-uP programme enters its crucial third year of execution. This represents a threefold increase from the RM6.6 billion deployed in 2024, signalling mounting confidence in the initiative's capacity to drive meaningful socioeconomic change. The momentum is expected to continue into the first quarter of 2026, providing sustained impetus for Malaysia's economic transformation agenda.
GEAR-uP, formally known as the Government-Linked Enterprises Activation and Reform Programme, was launched in 2024 under the stewardship of the Ministry of Finance with an overarching goal of deploying RM120 billion across a five-year horizon. The programme represents a fundamental shift in how Malaysia views its sovereign wealth and state-controlled capital: not as passive instruments seeking conventional financial returns, but as strategic tools mobilised around explicitly national objectives. Prime Minister Datuk Seri Anwar Ibrahim emphasised this distinction when launching the progress report, stressing that the programme transcends traditional notions of capital efficiency to encompass broader developmental goals that resonate with ordinary Malaysians.
Six major GLICs form the backbone of this initiative: Khazanah Nasional Bhd, the Employees Provident Fund, Permodalan Nasional Bhd, Kumpulan Wang Persaraan (Diperbadankan), Lembaga Tabung Angkatan Tentera, and Lembaga Tabung Haji. Their coordinated approach reflects a departure from the fragmented deployment patterns that have historically characterised state-controlled investment, instead creating a unified vehicle for directing Malaysia's substantial capital reserves toward identified strategic priorities. This consolidation enables the GLICs to pursue larger, more consequential infrastructure and development projects that individual entities might hesitate to undertake independently.
Data centre infrastructure has emerged as a particularly significant beneficiary of GEAR-uP capital. The Kwap-backed Google Selangor data centre project represents a flagship deployment, expected to generate 320 megawatts of additional capacity alongside 26,500 jobs through 2026 and 2027, while the parallel Empyrion Digital expansion in Johor adds further momentum to Malaysia's positioning as a regional data hub. These projects underscore how GEAR-uP capital is being deployed strategically into sectors that generate high-value employment and position Malaysia competitively within the reshaping global digital economy.
The programme's impact on venture and growth-stage financing is equally substantial. Dedicated GLIC investment vehicles including Dana Impak, Dana Perintis, Dana Pemacu, and Ekuinas are systematically moving Malaysian companies from early-stage ventures through to maturity. Khazanah's planned Dana Ciptawan will inject an additional RM200 million specifically targeting Bumiputera enterprises and mid-tier Malaysian firms, addressing a persistent financing gap that has historically constrained the scaling of Malaysian-owned businesses. This represents a meaningful effort to broaden the economic base beyond predominantly foreign-invested or politically-connected conglomerates.
Government-linked companies are themselves targets for transformation. The MY Value Up initiative projects that GLCs will add RM100 billion in market value by 2028, while simultaneously extending this discipline-driven approach to Malaysia's 88 largest listed companies. These initiatives directly feed into the ambitious Capital Market Masterplan, which targets market capitalisation of RM5.8 to RM6.3 trillion by 2030. Achieving these figures requires the systematic improvement of corporate governance, operational efficiency, and shareholder returns across Malaysia's investment ecosystem.
Infrastructure spending continues to accelerate under GEAR-uP guidance. Tenaga Nasional Bhd is expanding grid investment from RM12 billion in 2025 toward RM15 billion by 2027 as Malaysia pursues its renewable energy target of 70 per cent installed capacity by 2050. Malaysia Airports maintains a five-year upgrade programme worth RM11 billion, with Kuala Lumpur International Airport targeting over 100 million annual passengers. These capital-intensive projects generate substantial employment across construction, engineering, and manufacturing sectors while positioning Malaysia's infrastructure for long-term competitiveness.
Bumiputera economic empowerment represents a core pillar of GEAR-uP's social mandate. The programme targets ten Bumiputera company listings during 2026 and 2027, complemented by the ten Bumiputera Champions Programme designed to scale companies from startup to larger enterprise. Zakat Wakalah initiatives demonstrate expanding focus on Islamic finance mechanisms for wealth generation, with targets of RM100 million by 2026, nearly quadrupling from RM28 million in the prior year. These initiatives address the persistent disparity in wealth accumulation between Bumiputera and non-Bumiputera communities, though questions remain regarding whether these timelines and targets remain realistic given implementation complexities.
Minister of Finance II Datuk Seri Amir Hamzah Azizan articulated a conception of GEAR-uP success that extends far beyond accounting metrics. While the portfolio of GLIC companies delivered an aggregate shareholder return of 8.0 per cent in 2025, the programme's true measure lies in the living wages generated, graduates placed in quality employment, Bumiputera firms grown to competitive scale, and domestic supply chains anchored within Malaysia. This broader framing acknowledges that capital mobilisation means little without corresponding improvements in employment quality, skills development, and inclusive economic participation.
The programme's sustainability depends on maintaining disciplined execution despite persistent external turbulence. Malaysia successfully navigated the volatile international environment through 2023-2024 by implementing foundational economic reforms, positioning the nation to absorb shocks that might destabilise less-prepared economies. GEAR-uP's five-year horizon extends into a period of anticipated continued global uncertainty, requiring sustained political commitment to the programme's objectives even if financial markets reward alternative capital deployment strategies.
For Malaysian and regional observers, GEAR-uP represents an instructive experiment in state-directed capitalism adapted to contemporary circumstances. Rather than the heavy-handed central planning characteristic of earlier developmental state models, GEAR-uP operates through market mechanisms while explicitly directing capital toward identified national priorities. The approach carries both promise and risk: promise in the potential to align capital deployment with broader developmental objectives, risk in the potential for politically-motivated misallocation or capture by vested interests. The next three years will substantially determine whether this balance tilts toward sustainable value creation or disappointing returns.
The programme's success ultimately hinges on whether accelerated capital deployment translates into tangible improvements in Malaysian living standards and economic dynamism. While infrastructure projects, employment generation targets, and company scaling initiatives offer concrete benchmarks for assessment, the qualitative dimensions—whether wage growth outpaces inflation, whether domestic supply chains genuinely deepen, whether Bumiputera entrepreneurship demonstrably strengthens—remain inherently difficult to measure and even more challenging to attribute causally to GEAR-uP's specific interventions. The programme's architects have committed to staying the course, a commitment that will face repeated testing as the investment portfolio matures and results become increasingly visible to public scrutiny.
