Malaysia’s semiconductor sector to reach RM212.5 billion by 2028 - MIDA | Malaysian Investment Development Authority
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Malaysia’s semiconductor sector to reach RM212.5 billion by 2028

Malaysia’s semiconductor sector to reach RM212.5 billion by 2028

01 Jun 2023

OSAT vendors and ancillary firms providing support services are predicted to benefit from the rising demand for semiconductors 

Malaysia’s semiconductor sector is projected to achieve a compounded annual growth rate (CAGR) of 7%, reaching a total output of US$46 billion (RM212.52 billion) by 2028.

According to a recent report by Eastspring Investments and PwC Singapore, the manufacturing industry in Malaysia contributes nearly 25% of the country’s GDP and boasts strong integration with global value chains. 

The report highlights the opportunities available in two key sectors: Semiconductors and manufacturing, as Malaysia strengthens its manufacturing capabilities and trade links. 

As a well-established assembly and testing hub within the global semiconductor supply chain, Malaysia is expected to experience significant growth. Outsourced semiconductor assembly and testing (OSAT) vendors and ancillary companies providing support services such as precision cleaning, refurbishment and testing equipment are predicted to benefit from the rising global demand for semiconductors.

Furthermore, the report suggests that Malaysia’s OSAT players expanding into China will unlock further growth opportunities.

The study also identifies growth prospects for smart industrial machinery manufacturers as they embrace Industry 4.0 solutions in sectors like automotive, electrical and electronics, and medical devices. 

Government initiatives aimed at modernising healthcare facilities and promoting the production of high-end medical equipment present additional opportunities. 

Medical device manufacturers focusing on implantable devices, patient monitors, imaging equipment, and more are expected to witness substantial growth, with medical device sales projected to increase from US$1.9 billion in 2021 to US$3.6 billion by 2030. 

The report is part of a whitepaper titled “Asia 2.0 — Investing in an Era of New Opportunities”, which explores various dimensions of Asia’s ongoing transformation and the emerging opportunities for investors. 

Asia has emerged as an economic powerhouse, exhibiting robust growth over the past decade and poised for further expansion after recovering from the pandemic. 

Projections indicate that by 2030, Asia will contribute over 40% of the world’s GDP. Ignoring this immense potential and the accompanying opportunities would be ill-advised. 

The report said that Asia is currently undergoing a transformative phase characterised by demographic shifts, increased consumer spending, technological advancements and widespread innovation. 

With a thriving start-up ecosystem and a unique combination of established economies and high-growth emerging markets, Asia has become an attractive destination for investors. 

Factors such as digitalisation, alignment with global environmental, social, and governance (ESG) taxonomies, and strengthened regional partnerships add to the array of distinctive opportunities available. 

Based on a survey of 100 C-suite business leaders, the report reveals that 67% of respondents believe India holds the most potential for expansion or transformation opportunities, followed by China (57%) and Indonesia (38%). 

Source: The Malaysian Reserve

 

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