Malaysia expands cooperation in semiconductor industry

Malaysia will sign a strategic partnership with UK-based chip design firm Arm Holdings Plc to enhance the country’s semiconductor industry value chain.

Prime Minister Datuk Seri Anwar Ibrahim is expected to launch the strategic partnership later on Wednesday.

This move will kick off the journey towards the first Malaysia-based chip while providing a platform for local players to gain access to the semiconductor and software design firm’s intellectual property (IP) network, as well as transfer of technology and know-how.

The Prime Minister’s senior press secretary Tunku Nashrul Abaidah said that through the collaboration, Malaysia will make history in the global technology industry and witness a transformation in its AI and semiconductor landscape.

The PM views this collaboration as a strategic step to strengthen the country's technology ecosystem, positioning Malaysia as a key player in the global technology arena. This partnership will enable Malaysian companies to leverage advanced technology and expertise in semiconductors, as well as train the local skilled workers, he added.

With the agreement, Malaysia aims to set up 10 chip manufacturing companies with a total annual revenue of $20 billion and contributing 1% to the country’s GDP. In the long term, it wants to boost its local semiconductor industry to generate export revenue of $270 million by 2030.

Currently, despite being home to many large technology corporations such as Intel, GlobalFoundries, Infineon Technologies and playing an important role in packaging and testing, Malaysia has yet to have a significant influence in the chip design sector.

Last May, the Malaysian government committed to invest at least $5.6 billion in the semiconductor industry, with the goal of being self-sufficient in chip manufacturing within the next 5-10 years.