KUALA LUMPUR, El Sky News – Malaysia’s efforts to ascend the global semiconductor supply chain are intensifying with the approval of a detailed plan under the National Semiconductor Strategy (NSS). The plan specifically targets the development of 110 local companies to be directly involved in high-value activities, thereby reducing the nation’s reliance solely on foreign investment.
This announcement, seen as a critical step in the second phase of the NSS, signifies a shift in focus from Malaysia’s role as an assembly and test hub towards becoming a leader in IC design and advanced packaging.
Primary Focus: IC Design and Advanced Packaging
The key segments emphasized under this plan include:
- Integrated Circuit Design (IC Design): This is the highest value-generating activity in the semiconductor chain. Local companies will be supported to produce more complex and high-technology chips for applications in Artificial Intelligence (AI), Internet of Things (IoT), and advanced telecommunication technologies such as 6G.
- Advanced Packaging: Modern chip packaging technology now plays a crucial role in chip performance, replacing traditional methods. Malaysia aims to become a regional advanced packaging hub, leveraging its existing expertise in testing and assembly.
- Advanced Equipment Manufacturing: This initiative also aims to build local capability in producing the equipment and machinery used in chip fabrication plants (fabs), a segment currently dominated by global players.
Nurturing Local Electronic ‘Unicorns’
This master plan is not just about quantity, but about quality and value. The government has reportedly set a medium-term target for these companies to achieve high-income status.
“Our ultimate goal is to see these new companies achieve annual revenues of around RM1 billion within a specific timeframe. This is a strategic move to nurture local unicorns and gazelles (high-growth companies) capable of competing internationally,” said an industry analyst who requested anonymity.
The support channeled to these 110 companies will include access to R&D funding, more aggressive tax incentives, technical mentorship programs, and global market networking.
Long-Term Impact on the Economy
This move is expected to have a multiplier effect on the Malaysian economy:
- Improvement in Job Quality: Creating thousands of high-skilled job opportunities requiring expertise in electronic engineering, software design, and materials science.
- Strengthening the E&E Ecosystem: Fostering closer cooperation between industry, academic institutions, and research centers like MIMOS Berhad, ensuring research outcomes are commercialized rapidly.
- Supply Chain Resilience: Making Malaysia’s E&E supply chain more resilient and less vulnerable to global geopolitical disruptions.
With the NSS now moving towards a more results-oriented implementation, Malaysia is positioning itself on a fast track to become a major force in the high-tech electronics sector by the end of the decade.
(Leakim Otid)
