The Southeast Asian country is among a growing number of countries that are looking to position themselves as global manufacturing hubs for the industry and currently Malaysia accounts for 13% of global testing and packaging. To date it has attracted multibillion-dollar investments from the likes of Intel and Infineon.
Last year Infineon unveiled plans to invest $5.4bn to expand its power chip plant in Malaysia, while back in 2021 Intel announced it would build a $7nn advanced chip packaging plant in the country.
According to Anwar the proposed investment would be used to support integrated circuit design, advanced packaging and manufacturing equipment for semiconductor chips.
Malaysia is also looking to establish 10 local companies in design and advanced packaging for semiconductor chips, with revenues of between $210mn and $1bn.
Anwar said that the government would be allocating $5.3bn in fiscal support to meet these targets, although he did not specify a specific timeline as to when those targets would be met.
Malaysia is also planning to build Southeast Asia's largest integrated circuit design park and is looking to offer incentives such as tax breaks and subsidies to attract global tech companies and investors as it looks to move beyond backend chip assembly and testing and into high-value, front-end design work.
Chinese companies are already looking at the country as a suitable location of their assembling needs with Xfusion, formerly part of Huawei, partnering with Malaysia's NationGate to manufacture GPU servers.
Another Chinese company, StarFive, is building a design centre in Malaysia's Penang state, while chip packaging and testing firm TongFu Microelectronics is set to expand its Malaysia facility.
