BE GLOBAL CHAMPIONS IN SEMICONDUCTORS, AUTOMATION, IC DESIGNS- INDUSTRY EXPERT

By Fatin Umairah Abdul Hamid and Mikhail Raj Abdullah

KUALA LUMPUR, March 25 (Bernama) – Malaysian electrical and electronics companies must focus more on becoming global champions in the manufacturing of semiconductors, automation and integrated circuit designs.

This is because the advent of artificial intelligence (AI) has led to a phenomenal increase in the use of integrated circuit (IC) designs in a wide range of electronic devices, said Datuk Seri Wong Siew Hai, president of the Malaysia Semiconductor Industry Association (MSIA).

bootstrap slideshow

As such, Malaysia should take advantage of the projected tech upcycle and move up the value chain into IC design, said Wong, who started IC design in Intel Penang in the 1990s where he worked for 27 years.

Speaking to Bernama, he highlighted that starting up an IC design company requires a lower investment of between RM50-RM100 million, while the setting up of wafer fabrication plants (wafer fabs) involves a staggering US$10-20 billion (US$1=RM4.74).

He said investments in the setting up of wafer fabs should be left to the wave of American, Korean, European and Chinese firms slated to set up their new fab facilities in Malaysia, following the United States (US)-China chip war over the last few years, as they seek to mitigate their risks by merely being in one location.

He noted that US companies are moving some of their products out of China due to US restrictions and are looking to relocate, especially to Southeast Asia; while Chinese companies unable to ship to the US due to Washington citing "national security" concerns are also looking to move abroad to avoid US tariffs.

Wong also highlighted that IC design companies require more human capital than equipment or land, making it more amenable to local electronics firms, which is why they should venture into this area.

“We have had 52 years of experience in semiconductors, the time has come for Malaysia to move on to create global champions in areas such as assembly test, automation and IC design,” he said.

Given the current geopolitical tensions and the promising growth trajectory of semiconductor companies, there is a clear window of opportunity for Malaysian engineers and they should be actively encouraged to seize these opportunities.

"We possess a wealth of talent and skilled manpower, both domestically and among Malaysians abroad. Given the right encouragement, they can be incentivised to return.

“The government's support in raising funds to mitigate risks and lower entry barriers into the IC design business would greatly complement this effort," he added.

-- BERNAMA