Malaysia should add value in chip industry

By Lim Li Lian

Malaysia should take proactive measures to shift from being a low-cost semiconductor hub to becoming a country known for providing value in the chip industry, says Research for Social Advancement (REFSA) deputy director Lim Li Lian.

She said that multinational companies (MNCs) often look at Malaysia as a choice for their facilities due to its mature ecosystem.

“Many of these companies opt to establish their largest and most advanced manufacturing capabilities in Penang and Kulim,” she said in a statement, after concluding a semiconductor study tour in the northern

region, focusing on factories and industry players in Penang and Kulim. 

Lim said that Malaysia has a mature ecosystem spanning 50 years in the test, assembly, and packaging sectors, providing a foundation for further development in this field and expansion into other higher value-added segments of the chipmaking process.

According to her, the primary obstacle encountered globally in the technology sector is the scarcity of skilled talent.

“The most successful companies address this problem with proactive recruitment activities in higher learning institutions as well as having their own in-house training programmes to bridge the gaps.

“This is, however, sadly out of reach for many of our smaller small and medium enterprises (SMEs) and insufficient to meet current demand. Given that Malaysia does have a supply of good talent, many leave the country,” she said.

Lim emphasised the significance of bolstering Malaysia’s existing ecosystem through fostering stronger collaboration between MNCs and local firms, increasing the domestic content of exports, and expanding research and development (R&D) capabilities and initiatives.

-Published in New Straits Times on 11 May 2024.

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