Penang should learn from Selangor’s success to set up a semiconductor accelerator and IC design park. Penang should leverage on its current lead in back-end’s chip manufacturing to establish front-end IC design work. IC design will help to design microchips that are fundamental building blocks for electronic devices from smartphones to supercomputers.
A front-end semiconductor accelerator and IC design park would reinforce Penang’s position as the Silicon Valley in Malaysia. I will be meeting Penang Chief Minister Chow Kon Yeow as to why he feels Penang may not need an IC design park or there is no problem not having an IC design park as there are already many related companies in the state.
On 22 April, Prime Minister Datuk Seri Anwar Ibrahim at the KL20 Summit 2024 announced a plan for the semiconductor accelerator and IC design hub under the Selangor Information Technology and Digital Economy Corporation (Sidec). The project involves four strategic partners namely the Softbank owned Arm Holdings, the Shenzhen Semiconductor Industry Association, Penang-based IC designer SkyeChip Sdn Bhd and Malaysia AI Storage (MaiStorage) or Phison.
I welcome Chow’s announcement of expression of interest by 3 semi-conductor companies from China, who are considering investing USD100 million, would help to bolster Penang’s back-end manufacturing ecosystem. These companies are brought in by Penang-based Blue Chip Venture Capital, who also happen to be one of the main global fund partners of SIDEC’s IC design park.
Penang companies like SkyeChip, Phison and Blue Chip Venture Capital should be incentivized to focus fully in Penang, instead of diverting their business or resources to Selangor. Selangor has the vision to set up an IC design park in only 6 months.
With incentives of RM 125 million from the Selangor and Federal government and another RM 75 million from the private sector, many companies including those from Penang will be attracted to do the front-end IC design work there. Penang should participate fully if not take the lead to align with Putrajaya’s goal of shifting focus of the local tech sector from back-end chip manufacturing to high-value front-end design work.