Malaysia’s authorities goals to place itself as an vitality and chip manufacturing hub this 12 months, leveraging its geographical location and expertise in these fields, the nation’s prime minister stated yesterday.
Addressing an financial discussion board in Kuala Lumpur, Anwar Ibrahim, who additionally serves as finance minister, stated that the Malaysian economic system had skilled sturdy development in 2024, fortified by a listing of great overseas investments within the high-tech sector, together with synthetic intelligence (AI) infrastructure.
“In 2024, Malaysia efficiently tamed inflation, decreased unemployment and stabilized our foreign money,” he advised the Malaysia Financial Discussion board 2025, in response to the Star newspaper. “We’ve had report highs in job creation but additionally the very best performing inventory market in ASEAN.”
Anwar stated Malaysia will now purpose to “refine our experience” in oil and fuel, semiconductors manufacturing and Islamic finance to turn into a “world market chief” in every discipline.
“In 2025,” he added, “we need to double down on our geographical centrality, as a conduit for electrical energy, expertise, and provide chain diversification.”
In addition to having appreciable expertise in oil and fuel manufacturing, which dates again to the early a long time of the 20th century, Malaysia is a longtime regional chief in electrical and electronics manufacturing, together with in semiconductors. Most of its semiconductor manufacturing relies across the sprawling industrial parks round Penang, which had been established within the Nineteen Seventies, and within the close by Kulim Hello-Tech Park, which was arrange within the Nineties.
Regardless of a level of stagnation for the reason that Asian monetary disaster of 1997-1998, which has seen the manufacturing sector’s share of GDP decline from 31 % in 1999 to 23 % in 2010, Malaysia final 12 months notched a formidable variety of vital overseas investments in synthetic intelligence, cloud computing, and chip manufacturing. In Might, the U.S. search large Google introduced that it might make investments $2 billion to develop its first information heart and Google Cloud area in Malaysia, in an industrial park in Selangor state. This was adopted by the announcement in September that the Malaysian tech agency Dagang NeXchange Berhad and Google Cloud had signed a multi-year deal to offer sovereign cloud companies within the nation.
Over the previous few years, the nation has additionally attracted multibillion-dollar investments from the U.S. chipmaker Intel and the German agency Infineon, in addition to investments from different main Western and Chinese language corporations. Malaysia now accounts for 13 % of worldwide semiconductor testing and packaging, and is already the world’s sixth-largest exporter of semiconductors, in response to a report final 12 months within the New York Instances. Nonetheless, most of this includes the extra rudimentary steps within the chipmaking course of, comparable to meeting and testing.
Among the many targets of the Malaysian authorities’s Nationwide Semiconductor Technique (NSS), which was unveiled in Might of final 12 months, is to push into extra technologically refined processes comparable to design and superior manufacturing. In saying the NSS final 12 months, Anwar stated that his authorities plans to determine a minimum of 10 native corporations in design and superior packaging for semiconductor chips, and “transfer to the frontier” of the strategically essential expertise.
Below the NSS, Malaysia is concentrating on a further $1o0 billion in overseas funding. It has additionally earmarked fiscal assist of a minimum of $5.3 billion to supply incentives to overseas traders, together with tax breaks, subsidies, and visa exemption charges, and to coach 60,000 Malaysian engineers to satisfy trade demand.
A big a part of Malaysia’s pitch is that it’s a secure vacation spot for funding in a area roiled by geopolitical tensions. Final 12 months, Anwar pitched Malaysia to overseas chipmakers as “essentially the most impartial and non-aligned location for semiconductor manufacturing.” This can be a message that he repeated yesterday, saying that it was Malaysia’s “neutrality and openness for partnership that make us a pure hub for all.” If the previous 12 months means something, plainly an growing variety of overseas corporations are discovering this to be a compelling pitch.