Malaysia Confident of Maintaining Middle Power Status in Global Semiconductor Supply Chain - Minister Liew
KUALA LUMPUR, Sept 3 (Bernama) -- Malaysia is confident it can maintain its position as a middle power or “indispensable middle” in the global semiconductor supply chain through the implementation of the National Semiconductor Strategy (NSS), which was launched in May last year.
Deputy Investment, Trade and Industry Minister Liew Chin Tong said the country’s semiconductor industry, which has been developing for over 50 years, possesses its own strengths, particularly in outsourced testing and packaging activities, making Malaysia one of the primary investment destinations for multinational corporations (MNCs).
He said that other factors, such as strategic location, comprehensive infrastructure, and skilled local workforce, further enhance Malaysia’s appeal to foreign investors in this high-technology industry.
“Through the NSS, the government focuses on attracting foreign investments that possess advanced technologies, including advanced packaging.
“At the same time, we want to create an environment where Malaysian companies can emerge as multinational corporations themselves in the future,” he said in the Dewan Negara (Malaysian Senate) on Wednesday.
Liew was responding to a Senator regarding the government’s efforts to strengthen local semiconductor companies and reduce dependency on foreign semiconductor firms.
The deputy minister explained that the government aims to establish at least 10 Malaysian companies in advanced design and packaging with annual revenues of US$1 billion (US$1 = RM4.22), as well as 100 high-income local semiconductor-based companies generating annual revenues of RM1 billion.
“From early 2024 through the first quarter of 2025, the NSS has made progress, including training 4,557 engineers and technical personnel; identifying over 23,000 potential job opportunities; securing investments worth RM52 billion (domestic investment: RM2.1 billion and foreign investment: RM49.9 billion); and founding five local integrated circuit (IC) design companies,” he said.
Additionally, Liew said the Ministry of Investment, Trade and Industry (MITI), through the Malaysian Investment Development Authority (MIDA), is identifying local companies with potential in each semiconductor supply chain segment.
“This includes supplying chemicals and materials, manufacturing machinery and equipment, wafer fabrication, testing, and IC design to strengthen the existing ecosystem,” he elaborated.
Addressing concerns about the possibility of semiconductor companies relocating to the United States (US) following the country’s new tariff policies, Liew said MITI is not overly pessimistic, as many local companies supply other markets such as China, India, Japan, Korea, and Southeast Asia.
“So, our opportunities remain. We also hope to develop a horizontal integration strategy, where the local semiconductor industry can collaborate with the automotive, defence, and medical device industries, thereby strengthening the country’s technological capabilities not only for the US market but also for Asia and Africa,” he added.
Responding to a supplementary question regarding the potential loss of local jobs if semiconductor companies, including those owned by US firms, withdraw investments following Washington’s new tariffs, Liew said the US is not the sole export market for these products.
He noted that many semiconductor companies also supply products to firms in the region, as well as to supply chains in India, China, Japan, South Korea, and Southeast Asia.
“There are still opportunities to grow this sector through the NSS strategy. I hope we can achieve horizontal integration, meaning the semiconductor sector can merge with the automotive, defence, and medical devices industries,” he said.
Liew added that this approach would enable local companies to develop mid-level technologies not only for the US but also for countries in Africa and Asia.
-- BERNAMA
