What role will Khazanah play in supporting local chip firms?

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Khazanah to Increase Capital Allocation for Local Semiconductor Firms

Khazanah Nasional Bhd is planning to direct more capital towards supporting local semiconductor companies, specifically in funding their transition to advanced packaging. This strategic move aligns with Malaysia's broader industrial policies aimed at enhancing its position within the global semiconductor supply chain. The Malaysian government is actively seeking significant investments in the sector, offering substantial fiscal incentives to foster local capabilities in critical areas like chip design and advanced packaging.
Funding for Value Chain Advancement

Khazanah is actively exploring mechanisms to provide financial support for local semiconductor players. The objective is to enable these firms to ascend the value chain, particularly by investing in capabilities for advanced packaging. This focus on higher-value segments of the semiconductor industry is a key component of the nation's strategy to deepen its participation and competitiveness in the global market.
Alignment with National Industrial Policies

The wealth fund's increased focus on the semiconductor sector is in sync with the Malaysian government's comprehensive industrial policies. These policies are designed to solidify Malaysia's role as a crucial node in the global chip supply chain. The government's ambition includes attracting at least RM500 billion in semiconductor investments, bolstered by approximately RM21.5 billion in fiscal incentives, to achieve this goal.
Development of Local Capabilities

A significant aspect of the government's strategy, which Khazanah's capital deployment will support, is the development of indigenous capabilities. This includes fostering advancements in chip design and the sophisticated processes involved in advanced packaging. By bolstering these areas, Malaysia aims to move beyond assembly and testing towards more intricate and higher-margin segments of semiconductor manufacturing.

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What role will Khazanah play in supporting local chip firms?

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