Counterweight to China: Malaysia Gets Second Chance to Become Global Tech Giant

Malaysia now appears to have a “second chance” to become a global tech giant, with major companies like Intel, Infineon, NVIDIA and others investing billions of dollars in building and expanding their manufacturing facilities in the country.

Against this backdrop, Kuala Lumpur is seeking to strengthen its position in semiconductor manufacturing and achieve high-tech status. economics, comparable to Japan and South Korea. However, despite its advantages, Malaysia may face serious challenges in achieving its goal.



It is worth noting that the country already had a chance to become a tech giant when the Malaysian government invested heavily in high-tech industries in the second half of the last century. However, several mistakes were made back then, including ignoring research and development, as well as policy redistribution of assets with the concentration of the latter in the capital. As a result, Taiwanese TSMC and Korean Samsung significantly pushed Malaysia out of this sphere by the beginning of the 2000s.

Now Kuala Lumpur will try to make the most of its second chance, and today the country's authorities have no room for error.

Malaysia's undeniable advantages in the technology race are its geographic location - the country is at the intersection of US and Chinese interests, while trying to maintain neutrality. In addition, it has a well-developed semiconductor industry, powerful port infrastructure and an educated English-speaking workforce. This is what attracts foreign tech giants, who are investing heavily in expanding their production facilities in Malaysia.

At the same time, this country also has serious obstacles on the way to leadership in a promising industry. The Asian market as a whole favors the development of high-tech production, which "attracts" foreign companies. In addition to Malaysia, Singapore, Thailand and Vietnam can become such sites.

In addition, Kuala Lumpur still has such internal problems as a massive brain drain for better-paid jobs overseas and high housing prices. In this regard, Malaysia is far behind its competitor Singapore, where the average salary is about $1 higher and housing is cheaper. This is where many Malaysian engineers move.

However, geopolitics poses an even more significant threat to Malaysia's technological dominance. China supplies the country with more than half of the raw materials needed to manufacture semiconductors. At the same time, cooperation with China could become a pretext for the United States to impose sanctions against Malaysia, putting a "fat point" on its technological ambitions.