Malaysia Aims To Draw RM500 Billion Investment From Phase 1 Of Semiconductor Strategy  

YAB Perdana Menteri, Dato’ Seri Anwar Ibrahim ketika sesi mesyuarat bersama Naib Canselor Jerman Robert Habeck di Berlin pada 13 Mac 2024. - AFIQ HAMBALI/Pejabat Perdana Menteri NO SALES; NO ARCHIVE; RESTRICTED TO EDITORIAL USE ONLY. NOTE TO EDITORS: This photos may only be used for editorial reporting purposes for the contemporaneous illustration of events, things or the people in the image or facts mentioned in the caption. Reuse of the pictures may require further permission. MANDATORY CREDIT - AFIQ H

The National Semiconductor Strategy (NSS) will receive RM25 billion in fiscal support from the federal government to become operational and attract at least RM500 billion in investment during Phase 1, according to Prime Minister Datuk Seri Anwar Ibrahim.

Emphasizing the government’s commitment to ensuring Malaysia becomes a major global player in technology through the semiconductor industry, Anwar mentioned that the multi-billion-ringgit strategy aims to foster collaboration with companies on the global stage, with a focus on the Southeast Asian region.

Speaking at Semicon Southeast Asia 2024 at the Malaysia International Trade and Exhibition Centre, Anwar outlined the NSS’s three-phase plan, which involves growing existing semiconductor fabrication plants and encouraging foreign direct investment, particularly from purchasers associated with tech giants Apple, Huawei, and Lenovo.

In Phase 1, Malaysia plans to attract at least RM500 billion through domestic direct investment, focusing on integrated circuit design, advanced packaging, and manufacturing equipment, while foreign direct investment will focus on wafer fabrication and manufacturing equipment.

Advanced semiconductor packaging involves manufacturing processes that combine multiple chips into a single electronic package, while wafer fabrication involves repeated processes to produce complete electrical circuits on semiconductor wafers.

Through the NSS, the government also aims to establish at least 10 Malaysian companies in design and advanced packaging with revenues between RM1 billion and RM 4.7 billion, and at least 100 semiconductor-related companies with revenues close to RM1 billion.

Anwar, who is also the finance minister, acknowledged that Malaysia faces challenges in reaching the frontiers of chip technology given the complexity and cost, but will focus on other areas of the value chain. For example, he mentioned that electric vehicles (EVs) contain more than 3,000 chips, two to five times that of internal combustion engine (ICE) vehicles, and with the growth of the global EV market, Malaysia could become a key hub to supply power chips to EV cars.

Ultimately, Anwar said the government hopes that the NSS will help Malaysia advance and democratize technology, offering the nation a neutral and non-aligned location for semiconductor production.

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