Malaysia Should Bolster Japan Ties To Stay Competitive Globally

By Christine Lim

KUALA LUMPUR, April 2 (Bernama) -- Malaysia needs to enhance its relations with Japan as a weapon to boost competitiveness in the global market and increase investment in high-end niche technology industries, said key speakers at the New Japan-Malaysia Industrial Cooperation Seminar.

Malaysia Semiconductor Industry Association (MSIA) president, Datuk Seri Wong Siew Hai said this is because Japan is a major supplier of semiconductor silicon wafers, accounting for about 53 per cent of the global market share.

“Japan has the technology, all the way from integrated circuit design to end products of the semiconductor industry.

“So I think there is an opportunity to enhance collaboration to help Malaysia strengthen its position in niche technologies and achieve its semiconductor strategy goals, as Japan is indispensable in every part of the supply chain in the industry,” he said in an interview with members of the media during the seminar recently.

He is confident Malaysia can attract more foreign direct investment (FDI) from Japan, being the preferred location due to its shelter from global risks.

“We need to seize this window of opportunity before it passes and attract more investments from Japan, such as in wafer fabs (semiconductor processing factories),” he said.

He pointed out that, in view of the ongoing geopolitical tension and war, there is also a need to diversify supply sources, rather than relying solely on traditional markets such as China and the United States.

Wong also emphasised the need for the government to facilitate companies by improving the ease of doing business.

He noted the various challenges faced by the industry, including inflationary pressures, particularly if geopolitical tensions persist, leading to higher oil prices.

“Despite all the challenges the whole world is facing now, Malaysia can come out stronger if it can be more competitive globally and be ahead of other countries,” said Wong.

Meanwhile, ASEAN Business Advisory Council (ASEAN-BAC) Malaysia chairman, Tan Sri Mohamed Nazir Abdul Razak said Malaysia can leverage the strong bond with Japan based on the 70-year diplomatic relations that have endured through all sorts of crises.

“We need to highlight the vast opportunities in Malaysia to international investors -- supported by our political stability, the ecosystems and the talent pool -- as they relook at repositioning their supply chains and their investments,” he said.

Kazuto Suzuki, director of the Institute of Geoeconomics, a Japan-based independent think tank, said stability in the government reassures investors. 

He opined that while there is always a risk in terms of exchange rates, this risk is mitigated by political stability and incentives such as lower taxes, which will attract investors.

“Predictability is a key concern for investors. Providing advance notice of policy changes helps ensure transparency and gives companies time to mitigate risks,” added Suzuki, who is also a professor at the University of Tokyo, Graduate School of Public Policy.

--  BERNAMA