Malaysia Embraces the Race in Semiconductor Manufacturing
In a bold move, Malaysia is pushing into the competitive global semiconductor manufacturing industry, unfazed by the presence of giants like China and the U.S., according to the country’s Second Finance Minister Amir Hamzah Azizan.
Riding the Wave of Growth
With the semiconductor industry experiencing a surge in demand, Malaysia believes it can capitalize on this opportunity. As Amir Hamzah explained to CNBC, “The semiconductor space is now in the upcycle — and Malaysia will be a beneficiary of that.”
Malaysia dismisses China, its largest trading partner, as a direct rival in this sector. Instead, the country sees ample growth for all players involved.
Riding the Geopolitical Currents
Current geopolitical tensions have highlighted the importance of robust supply chains. Amir Hamzah believes Malaysia can meet this challenge by providing a stable and efficient supply chain network.
He stated, “We’re seeing a lot of end users now diversifying their supply chain. Our focus, actually, is to provide a very vibrant, strong supply chain connectivity, and make sure that we ride on that.”
Targeting the Higher Ground
Malaysia’s strategy is to shift away from the lower-end chip production and focus on moving up the value chain.
Currently, the country holds 13% of the global market for chip packaging, assembly, and testing services. The government is also taking steps to enhance its semiconductor ecosystem and attract investments.
A Different Approach to the U.S.
While the U.S. invests heavily in high-end chip manufacturing, Malaysia offers a distinct value proposition. Amir Hamzah explained, “I think where Malaysia competes in, we’re not going to go head on to the tail end of the high-end competition, where maybe the U.S. is bringing all the parts.”
Instead, the country will focus on expanding its value chain to appeal to new businesses and solidify its position in the industry.
Scale and Collaboration
In the end, the key to success in semiconductor manufacturing is economies of scale. Malaysia aims to increase its production capacity through collaboration and partnerships.
As Amir Hamzah summarized, “At the end of the day, it’s about economies of scale.”
