MALAYSIA must reduce its reliance on electrical and electronics (E&E) exports by diversifying into other high-value industries, says Datuk Seri Johari Abdul Ghani.
The Investment, Trade and Industry Minister said this is crucial as the E&E sector accounted for 48.4% of the nation’s total exports from January to August, leaving it vulnerable to fluctuations in global semiconductor demand.
He noted that the semiconductor industry, in particular, is exposed to global economic conditions, technological changes, supply chain disruptions and geopolitical developments.
“These risks could lead to inventory depletion and lower output, putting pressure on E&E exports and the country’s overall export performance,” he said in reply to a question from Muhammad Fawwaz Mohamad Jan (PN-Permatang Pauh).
Johari said Malaysia exported RM1.6 trillion worth of goods last year, of which RM712bil were E&E products.
Semiconductors, a major component of E&E exports, contributed RM483.6bil, or about 68% of the sector’s exports, during the first eight months of this year.
The government had implemented three key strategies to minimise the risks facing the E&E and semiconductor sectors.
The first was to strengthen and diversify the E&E value chain under the New Industrial Master Plan 2030 and the National Semiconductor Strategy.
The second strategy was to expand other high-value industries, including pharmaceuticals, automotive, aerospace, chemicals and petrochemicals, while strengthening domestic supply chains.
“Malaysia will also expand its export markets through the Malaysia External Trade Development Corporation (Matrade), targeting regions such as Central Asia, Africa and Latin America,” he said.
In response to a supplementary question from Datuk Adnan Abu Hassan (BN-Kuala Pilah), Johari said Malaysia needs to reduce its reliance on imported components and materials used to manufacture goods for export.
He said E&E exports totalled RM712bil in 2025, while the sector imported RM567bil, resulting in a trade surplus of RM145bil.
By comparison, non-E&E exports amounted to RM897bil, against imports of RM885bil, resulting in a surplus of RM12bil.
The government wants more local companies, particularly small and medium enterprises (SMEs), to produce components and semi-finished goods that are currently sourced abroad.
