Malaysia aspires to be E&E hub despite US-China tech war

said the government aims to further develop the technology for aerospace as well as human capital capability that would support growth in the industry.

KUALA LUMPUR: With the escalating technology war between the United States and China, giant tech companies have had to slash their future revenue forecast due to looming concerns over the tensions between the two economic superpowers.

On the other side of the world, Malaysia has been known as a hub for the electrical and electronics (E&E) industry, with major players worldwide having entered the country as it acts as a key gateway to service the growing South-East Asia region.

International Trade and Industry (Miti) Minister Datuk Darell Leiking has assured that despite the ongoing tech and trade war between the two countries, Malaysia will remain neutral and continue to aspire to be the hub for E&E as well as other businesses.

“Despite the tensions in the global economic environment, we remain optimistic that Malaysia has its strengths to overcome the negativity.

“We are still in a positive trend as proven by the increase in investments in the manufacturing, services and primary sectors,” he said.

The minister explained that investment data for the first quarter of 2019 (Q1 2019) by the Malaysian Investment Development Authority (Mida) showed an increase of 3.1% to RM53.9bil from RM52.3bil recorded in the same period last year.

According to Mida’s data, foreign investments increased by 73.4% to RM29.3bil from RM16.9bil in Q1 2018, while domestic investments approved in Q1 2019 amounted to RM24.6 billion, contributing 45.6% to the total.

Meanwhile, the Penang state government has urged local E&E players to explore the opportunities arising from the ongoing trade dispute.

Special investment adviser to the Chief Minister of Penang Datuk Seri Lee Kah Choon said local companies should see it as an opportunity for them to fill the vacuum, citing the US$2bil void left by Broadcom Inc due to the US ban on exports to Huawei.

“It is in our best interest that the tech war stays at bay and does not affect the local E&E sector. However on the brighter side, the local E&E sector would have the chance to fill the demand for chips needed by Huawei,” he said.

In terms of foreign direct investment (FDI), Lee, who is also InvestPenang director, said despite stiff competition from neighbouring countries such as Thailand, Cambodia and Vietnam, Malaysia in general has not only the environment needed but also the global supply chain connection, infrastructure and human resources that suit the needs of multinational corporations. — Bernama