PETALING JAYA: The recent signing of the US-Malaysia memorandum of cooperation (MOC) on semiconductor supply chain resilience and the launching of the Indo-Pacific Economic Framework for Prosperity (IPEF) with a dozen initial partners, including Malaysia, will help lower costs by making semiconductor and electronics supply chains more resilient in the long term.
Malaysia Semiconductor Industry Association (MSIA) president Datuk Seri Wong Siew Hai (pix) said: “The US-Malaysia MOC in semiconductor supply chain resilience and the IPEF is a positive development for the Malaysia semiconductor and E&E industry and further consolidates Malaysia’s position as one of the critical global semiconductor hubs.”
The industry is experiencing a period of high growth with digital transformation and emerging technologies such as internet of things, artificial intelligence, smart factories and autonomous vehicles. Semiconductor companies like Intel, Samsung & TSMC and countries like China, USA & Europe have announced investments over the past one year, exceeding US$550 billion (RM2.42 trillion) in fabrication plants to meet the increasing demand for semiconductors.
Companies in Malaysia are expanding and increasing capacity to address the shortage in semiconductor. Malaysia is also attracting new investments to strengthen its supply chain. A more resilient and flexible semiconductor supply chain will allow the industry to manage market volatility much better.
The industry must steer a course towards a future where sustainable growth can be achieved through resilience and strategic global connections because the semiconductor and electronics industry have the most complex and geographically dispersed value chain in the world.
Last year, Malaysia recorded approved investments of RM148 billion, which was 9.5 times the approved investments in 2020 of RM15.6 billion.
Recently, Malaysia has managed to attract new investments worth RM16.52 billion from the US through the Trade and Investment Mission led by Senior Minister of International Trade and Industry, Datuk Seri Mohamed Azmin Ali.
US President Joe Biden announced on Monday that 12 countries in the Asia-Pacific had joined the US’ IPEF, an agreement which covers supply chains, digital trade, clean energy and anti-corruption efforts. The countries include Malaysia, Australia, Brunei, India, Indonesia, Japan, South Korea, New Zealand, the Philippines, Singapore, Thailand and Vietnam as well as the US, were these 12 countries account for 40% of the world’s GDP.