Malaysia Plans to Build Southeast Asia’s Largest Semiconductor Design Park

Malaysia announces plans to build Southeast Asia's largest integrated circuit design park. Malaysia's central Selangor state will back the proposed integrated circuit design park. It aims to attract world-class anchor tenants and collaborate with global companies such as British chipmaker Arm Holdings. The park is expected to play a pivotal role in developing the semiconductor manufacturing industry in Malaysia.

According to Malaysian Prime Minister Anwar Ibrahim, the proposed integrated circuit design park is a component of the country's strategy to transition from backend chip assembly and testing to high-value front-end design work. Malaysia is already a major player in the global semiconductor industry, accounting for about 13% of global testing and packaging.

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Malaysia is aiming to turn Kuala Lumpur into a regional digital hub and be among the top 20 countries in the global startup ecosystem index by 2030. Furthermore,  Economy Minister Rafizi Ramli stated that the government will offer additional incentives such as subsidized office spaces, exemptions on employment passes, relocation services, and lower corporate tax rates for foreign venture capital firms, tech entrepreneurs, and unicorns—startups reaching a USD 1 billion valuation.

In addition to the integrated circuit design park, Malaysia's sovereign wealth fund, Khazanah Nasional, will launch a fund to invest in innovative, high-growth Malaysian companies, with an initial allocation of USD 209 million. This move is expected to further stimulate the growth of the tech industry in the country.

Integrated Circuit Chips and its Importance

Integrated Circuit (IC) chips, commonly known as microchips, are the fundamental building blocks of modern electronics. They are compact electronic chips made up of interconnected components that include resistors, transistors, and capacitors. These chips are built on a single piece of semiconductor material, such as silicon.

ICs are the major enablers of current and future technologies and applications, such as 5G/6G, smart factories and cars, blockchains, artificial intelligence (AI), and machine learning. They are used in a wide range of devices, from simple household appliances like toasters to complex high-tech machines for medical use.

For further details read our in-depth blog about semiconductor packaging.

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