Malaysia aims to move beyond the packaging and testing industry into the chip design sector along the semiconductor supply chain by announcing Southeast Asia’s largest IC design park.

According to reports from The Edge Malaysia, Malay Mail, AFP, and Channel News Asia, on April 22, Malaysian Prime Minister Anwar Ibrahim announced a plan to build Southeast Asia’s largest IC design park, Malaysia Semiconductor and Accelerator and IC Design Park, in Puchong, Selangor. The site will start in a 45,000-square-foot building and will later expand to a 60,000-square-foot location.

The project, supported by the central government, aims to welcome over 300 IC design engineers to the park in its first year and expects the number to grow each year.

Anwar was quoted as saying that he’s pleased to announce the largest IC design park in Southeast Asia, which will house world-class anchor tenants and collaborate with global companies such as Arm. He said the park signifies Malaysia’s ambition to move from packaging and testing to high-value IC design.

Yong Kai Ping, CEO of Selangor Information Technology & Digital Economy Corporation (Sidec), which leads the project, stated that as competition in the semiconductor industry heats up, Malaysia needs to act quickly to capitalize on opportunities in chip design and climb the value chain.

The park, scheduled to commence operations in July 2024, will offer essential public services and facilities, such as affordable electronic design automation (EDA) tools, servers, intellectual property (IP), multi-project wafer (MPW) services, and training programs. Project partners include Arm, Phison Electronics, SkyeChip, and Shenzhen Semiconductor and Display Industry Association (SSDA).

SkyeChip is a Malaysia-based IC design house established in 2019 by ex-employees from Intel, Broadcom, and Motorola. SSDA has 587 members in China. Taiwan-based Phison Electronics announced an investment of MYR100 million (US$20,927 million) in setting up a startup called MaiStorage in addition to technology transfer worth MYR1 billion and 200 experienced engineers.

Malaysia’s trade minister, Zafrul Aziz, earlier told Nikkei Asia the country’s geopolitical neutrality and strategic location as attractive factors for multinational semiconductor companies seeking investment destinations.