Malaysia aims to develop semiconductor industry

Malaysian Deputy Minister of Investment, Trade and Industry (MITI) Liew Chin Tong said the government is committed to developing the semiconductor industry which is now a strategic income source for the country.

Speaking at the parliament on March 26, the deputy minister said trade and technology competition between China and the US in the semiconductor industry has benefited Malaysia.

According to Liew, this competition has led multinational semiconductor companies to make strategic decisions to build a second supply chain and not to focus solely on one country to ensure a secure and resilient supply chain or “derisking”.

He noted that many companies have selected Malaysia as a new location for their production facilities and the country has an advantage over other nations with a mature semiconductor industry ecosystem since the 1970s, especially the E&E cluster in Penang and Kulim, Kedah.

He acknowledged that such investments are expected to continue to position Malaysia as one of the key investment destinations in advancing the global chip industry, and the country should seize this golden opportunity to expand the country’s semiconductor industry and become a high-value-added semiconductor producer with activities along the value chain, such as integrated circuit (IC) design, wafer fabrication, assembly and testing as well as technical marketing.

Liew emphasised that the government aims to ensure that investments in Malaysia will create value chains that create high-paying skilled jobs, adding that Malaysia wants to create a supply and value chain that encompasses local companies. The country aims to create 100 technology companies with an annual revenue of 1 billion MYR (213 million USD) before 2030.

Currently, Malaysia only has nine local technology companies that can generate 1 billion MYR a year. Another 10 companies generate between 100 million MYR and 1 billion MYR a year, he said.