Malaysia Unveils Plans for Southeast Asia's Largest Integrated Circuit Design Park

Malaysia infra boost: Malaysia is gearing up to solidify its position as a tech powerhouse in Southeast Asia with ambitious plans to establish the region's largest integrated circuit design park. Announced on Monday, the government's initiative includes a comprehensive package of incentives aimed at attracting global tech companies and investors.

With aspirations to transform Kuala Lumpur into a regional digital hub, Malaysia aims to vault into the top 20 countries in the global startup ecosystem index by 2030. Prime Minister Anwar Ibrahim underscored this vision, emphasising the country's commitment to advancing from backend chip assembly to high-value front-end design work.

As a significant player in the semiconductor industry, Malaysia already accounts for about 13 per cent of global testing and packaging. The proposed integrated circuit design park, supported by the central Selangor state, is poised to elevate Malaysia's standing further. It will host renowned anchor tenants and forge partnerships with global giants like British chipmaker Arm Holdings, although specific details are yet to be disclosed.

In a bid to foster innovation and growth, Malaysia's sovereign wealth fund Khazanah Nasional will initiate a fund dedicated to investing in high-growth Malaysian companies, with an initial allocation of 1 billion ringgit ($209 million). This move underscores the government's commitment to nurturing homegrown talent and fostering a vibrant tech ecosystem.

Economy Minister Rafizi Ramli outlined a range of incentives designed to attract foreign venture capital firms, tech entrepreneurs, and unicorns—startups valued at $1 billion or more—to invest in Malaysia. These incentives include subsidised office spaces, exemptions on employment passes, relocation services, and lower corporate tax rates.

Rafizi emphasized the government's goal of attracting global unicorns to Malaysia to create high-skilled, high-value jobs and cultivate a pipeline of future tech leaders and entrepreneurs. The announcements were made at the KL20 Summit event, which aims to introduce new policies to bolster support for Malaysian startups.

With Reuters Inputs