‘SEMICONDUCTOR PLAN MUST COVER ECOSYSTEM’
Strategic plan should have investor-friendly policies, says expert
THE semiconductor strategic plan should cover the industry’s ecosystem for Malaysia to achieve the goal of becoming a preferred investment destination for the industry, said an expert.
Putra Business School analyst Associate Professor Dr Ahmed Razman Abd Latiff said it was important for the plan to have investor-friendly policies and for the industry to have enough skilled workers.
“It is essential to ensure that the strategic plan encompasses the industry’s ecosystem and that it also covers the supply chain.
“We want to make sure that we not only have the right infrastructure and facilities, but also have investor-friendly policies and enough skilled workers for investing companies.”
He said Malaysia must facilitate knowledge transfer to promote innovation and create added value for companies and the industry.
On Tuesday, the National Investment Council instructed the Investment, Trade and Industry Ministry to develop a semiconductor strategic plan to sustain Malaysia’s status as a preferred investment destination.
Prime Minister Datuk Seri Anwar Ibrahim said this was crucial to attract semiconductor companies to establish high-quality manufacturing facilities.
“The strategic plan will include incentive packages to attract strategic investments in the hightech semiconductor sector, particularly to encourage front-end activities in the industry,” he said in a Facebook post on Tuesday.
Centre for Market Education chief executive officer Carmelo Ferlito said while an attempt to preserve Malaysia’s competitiveness was welcomed, in particular in a crucial sector like semiconductors, the effectiveness of the master plan was questioned.
He said the government should focus on designing a broad and comprehensive pro-competitiveness bill, like Indonesia’s Omnibus Law, to establish the nation as a regional investment hub.
“I tend to be sceptical about the usefulness of master plans, blueprints and strategic plans, which often turn out to be not much more than well-crafted wish lists.
“Malaysia should aim to restore its place as a preferred regional investment destination not only for semiconductors, but in general.
“What I have in mind is what was designed in the past with schemes like the principal hub designed by the Malaysian Investment Development Authority and which needs to be upgraded in light of the regulations that came afterwards.”
A principal hub is a locally incorporated company that uses Malaysia as a base for conducting its regional or global businesses and operations to manage, control and support its key functions, including management of risks, decision making, strategic business activities, finance, management and human resources.
Ferlito said Malaysia had potential as a regional hub, emphasising the need for a holistic approach that included simplifying business registration, fair taxation, access to labour and a robust banking system.
On Tuesday, Anwar said the third meeting of the National Investment Council focused on assessing the current state and future prospects of Malaysia’s semiconductor industry, as well as supporting expansion proposals.
He said the meeting reviewed the proposal for the development of the Kerian Integrated Green Industrial Park (KIGIP).
It was agreed that the proposal would be executed through a collaborative effort involving government-linked investment companies and the federal and Perak governments.
“This marks the beginning of the Madani government’s efforts to accelerate the development of KIGIP, which is seen as a key driver in attracting green investment.
“KIGIP will be fully powered by renewable energy, in line with the country’s aspirations to achieve carbon neutrality by 2050.”