The Challenges of Malaysian Technopreneurs: Lessons from China

Malaysia has long aspired to be a regional leader in technology and innovation. Yet, despite ambitious plans and policy frameworks, Malaysian technopreneurs continue to face significant challenges. A comparison with China’s approach to fostering technological innovation highlights crucial lessons Malaysia can learn to build a more competitive and sustainable tech ecosystem.

1. Policy Consistency vs. Political Uncertainty

One of the most striking contrasts between Malaysia and leading tech powerhouses like the US and China is policy stability. In the US, political parties change, but core policies on innovation and entrepreneurship remain consistent. Meanwhile, China takes a radically decentralised economic approach, where local governments aggressively support technological enterprises.

Malaysia, on the other hand, suffers from frequent policy shifts that disrupt business continuity. Government initiatives are often tied to the ruling political party’s agenda rather than long-term national interests. As a result, Malaysian technopreneurs face uncertainty when policies and incentives change with every new administration.

2. Selective vs. Inclusive Support for Entrepreneurs

China’s success in developing industries such as electric vehicles (EVs) and solar panels is attributed to a model where thousands of entrepreneurs receive government support, not just a few politically connected players. Chinese local governments help the most productive companies by facilitating funding, talent attraction, and market access.

In Malaysia, government-backed initiatives tend to favor a select few rather than fostering a broad-based, competitive ecosystem. Many startups struggle to secure funding and support unless they have the right political connections. This limits the overall growth potential of Malaysia’s tech sector.

3. Decentralised Economic Model vs. Bureaucratic Centralisation

China’s “mayor economy” model encourages competition among local governments to attract the best technology and investments. Each mayor acts as a business developer, actively engaging with private entrepreneurs to drive economic growth. This model enables China to rapidly scale innovations and build entire industrial ecosystems in multiple regions.

Conversely, Malaysia operates a heavily centralised bureaucratic system, where decision-making is slow and cumbersome. State and federal agencies often work in silos, creating redundant processes that hinder technological progress. Decentralisation, with more autonomy for state and city governments to support local startups, could be a game-changer for Malaysia.

4. Infrastructure and Ecosystem Development

China’s rapid expansion in EVs was possible because the government facilitated the roll-out of 4 million EV charging stations nationwide. In contrast, the US only has about 160,000. This kind of large-scale infrastructure investment is crucial for technological advancements to take off.

Malaysia, despite its aspirations to be a leader in green technology, lacks the infrastructure to support high-tech industries at scale. The development of smart cities, data centers, and industrial zones needs more aggressive government backing to attract investors and innovators.

5. Talent Retention and Youth Engagement

China recognises that the younger generation is different they value experiences, sustainability, and purpose-driven careers. Local governments create incentives such as subsidised housing and fast-track business support to attract and retain young talent in high-tech industries.

In Malaysia, brain drain remains a serious issue. Many talented technopreneurs move abroad due to limited opportunities, lack of merit-based funding, and bureaucratic red tape. Addressing this challenge requires Malaysia to build a more attractive environment where young innovators see long-term prospects.

6. Financial Ecosystem and Risk Appetite

Chinese banks and financial institutions actively support startups by providing coordinated financing, even in risky but high-growth sectors. Malaysia’s financial ecosystem, however, remains conservative, often prioritising low-risk ventures over groundbreaking technological innovations.

Encouraging venture capital participation, improving access to grants, and fostering a more risk-tolerant investment culture are crucial steps to help Malaysian technopreneurs scale their businesses.

Systemic Change

The Malaysian government must take a long-term, systemic approach to supporting technopreneurs. This includes:

By adopting some of China’s successful strategies while maintaining democratic principles and transparency, Malaysia can create a thriving tech ecosystem. If not, the nation risks falling behind as other emerging economies accelerate their technological advancements.