Penang acquires land to meet industrial demand for next decade
DESPITE land constraints, Penang is well positioned to support the continued expansion of its semiconductor industry.
Chief Minister Chow Kon Yeow said Penang’s transformation over the past five decades had been driven by a strong industrial base comprising more than 350 multinational corporations (MNCs), over 6,500 manufacturing-related small and medium enterprises (SMEs) and a highly skilled workforce.
While acknowledging space limitations, Chow said the state was continuing to attract semiconductor investments through strategic land acquisitions.
“As production investments continue to grow, the key infrastructure challenge is land availability.
“We are actively acquiring land for industrial development and are expanding beyond Batu Kawan, with Central Seberang Perai identified as a key growth area.
“Although Penang is the country’s second smallest state, we will continue making more land available through acquisitions.
“We have sufficient land to meet industry needs over the next few years while planning for future expansion,” he said at the Malaysia Semiconductor Industry Association (MSIA)-Penang Chief Minister Dialogue 2026 in George Town.
He was responding to a question from MSIA president Datuk Seri Wong Siew Hai on Penang’s key infrastructure challenges as semiconductor investments grew.
Chow said the state had begun acquiring 809ha to 1,214ha of land to meet industrial demand over the next five to 10 years.
He said although there was growing competition from states such as Kedah, Johor, Selangor and Melaka, Penang was confident of retaining its appeal among investors.
“Over the past three years, we launched various initiatives to strengthen our competitiveness, including the Penang Automation, Test and Equipment Campus and Penang Silicon Design @5km+ scheme,” said Chow.
“We need a resilient supply chain and we must identify gaps in the value chain and determine which sectors to target.
“Penang is selective about the investments it attracts.
“Many years ago, we turned away some investors because they did not add value to our supply chain.
“We know what we want and that means remaining competitive and attractive to investors.”
Chow said Penang ranked third among Malaysia’s top investment destinations in 2025, recording RM22.4bil in approved manufacturing investments.
The electrical and electronics (E&E), machinery and equipment sectors are the main growth drivers, contributing RM17bil (74%) of the state’s total approved manufacturing investments.
“While these figures are encouraging, the global semiconductor industry faces a rapidly evolving and increasingly challenging environment.
“Geopolitical tensions, regional conflicts, trade uncertainties, changing tariff regimes, energy price fluctuations, and supply chain and logistics disruptions continue to pose significant challenges for businesses worldwide.
“Amid these uncertainties, I would like to reaffirm the state’s unwavering commitment to strengthening our industrial capabilities and enhancing Penang’s position in the global semiconductor value chain,” he added.
