BUSINESS

Trade Minister Touts Malaysia’s Advantages as a Chip Investment Destination

Published: Sep. 4, 2025 6:33 p.m. GMT+8

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Tengku Zafrul Aziz, Malaysia’s Minister of Investment, Trade and Industry. Photo: VCG

Lingering uncertainty over U.S. trade policy could make Malaysia an ideal destination for semiconductor investment, a Malaysian minister told Caixin.

After roughly 60 years building up its semiconductor industry, Malaysia has been “very lucky” to be able to meet the needs of global chip firms that care about supply chain resilience and security, said Tengku Zafrul Aziz, Malaysian Minister of Investment, Trade and Industry. The companies tend to invest in countries that “are neutral and already have a semiconductor ecosystem in place.”

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Malaysia is positioning itself as a prime destination for semiconductor investment due to its neutral stance, established ecosystem, and comprehensive supply chain.
The National Semiconductor Strategy (NSS), launched in May 2024, targets advanced packaging, IC design, and high-end manufacturing, backed by at least 25 billion ringgit ($5.9 billion).
Unpredictable U.S. trade policy, including threats of tariffs up to 300% by President Trump, increases Malaysia's appeal for global chipmakers seeking supply chain resilience.

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Who’s Who

Intel Corp.: Intel Corp. is among the "big names" in the industry that have invested in Malaysia. This highlights Malaysia's appeal as a semiconductor investment destination, due to its comprehensive supply chain and growing capabilities in various aspects of chip manufacturing.

Micron Technology Inc.: Micron Technology Inc. is a major semiconductor company that has invested in Malaysia. Malaysia is attractive to such companies due to its comprehensive supply chain and efforts to advance its semiconductor industry beyond assembly and testing.

Infineon Technologies AG: Infineon Technologies AG, a German semiconductor manufacturer, is one of the "big names" that has invested in Malaysia. The company contributes to Malaysia's robust semiconductor ecosystem, which has attracted such investments due to its comprehensive supply chain and advantages in assembly and testing.

Renesas Electronics Corp.: Renesas Electronics Corp. is a Japanese semiconductor manufacturer. The company is mentioned as one of the big names in the industry that has invested in Malaysia, highlighting Malaysia's appeal as a semiconductor investment destination due to its comprehensive supply chain and growing capabilities.

BYD Co. Ltd.: BYD Co. Ltd. (比亚迪股份有限公司) is a Chinese electric vehicle giant. It is constructing a car assembly plant in Malaysia, with production scheduled to commence in the second half of the following year. This indicates BYD's investment in Malaysia's manufacturing sector.

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What Happened When

May 2024：: Malaysian government launched the National Semiconductor Strategy (NSS), a 10-year roadmap for transforming the country into a global semiconductor major.

July 31, 2025：: President Donald Trump signed an executive order to reduce reciprocal tariffs on most Malaysian imports to 19% from previously scheduled 25%.

August 2025：: President Donald Trump threatened to impose tariffs of up to 300% on semiconductor imports.

September 2, 2025：: Malaysian Minister of Investment, Trade and Industry Tengku Zafrul Aziz gave an interview in Beijing discussing Malaysia's semiconductor industry and investment climate.

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