KUALA LUMPUR: Malaysia’s electrical and electronics (E&E) industry celebrated its 50th anniversary this year by recording a compounded annual growth rate of 16% over five decades.

“This is equivalent to Malaysia’s E&E exports doubling every five years, an impressive performance,” said Datuk Seri Wong Siew Hai, president of the Malaysian Semiconductor Industry Association (MSIA) at a gala dinner on Monday (May 30) night here to celebrate the golden anniversary of what he described as “Malaysia’s golden goose”.

Wong said the E&E industry has grown leaps and bounds after starting here in 1972, with total exports in that year being only RM230mil.

In 2021, the amount jumped to RM456bil, making up 37% of Malaysia’s total exports.

“In 2021, the E&E industry contributed 6.85% to the GDP, valued at RM95bil.

“Malaysia is recognised as one of the primary semiconductor manufacturers in the global value chair, with seven percent of global semiconductor trade flowing through Malaysia and 13% of backend semiconductor capacity located in Malaysia,” said Wong at the simple yet highly meaningful event where the audience was brought through the decades of achievements.

Companies with long histories in Malaysia were recognised for their contribution to Malaysia, such as Infineon T Technologies, Motorola Solutions Malaysia, TF-AMD, Osram Opto Semiconductors, Intel Malaysia, STMicroelectronics, Texas Instruments, Broadcom, Renesas Malaysia, Amkor Technology, Carsem, Keysight Technologies, Agilent Technologies, and Robert Bosch.

IBM was also singled out for a special award for being present in Malaysia for 61 years, while Western Digital was honoured for its outstanding push for sustainability for its Batu Kawan facility in Penang.

Guests of honour for the night included Datuk Seri Azmin Ali, Senior Minister for Trade and Industry, his deputy Senator Datuk Lim Ban Hong, as well as Datuk Seri Mustapha Mohamed, Minister in the Prime Minister’s Department, along with senior government officials in related ministries and agencies.

Organised by MSIA, the event was supported by the Malaysian Investment Development Authority (Mida) and the Malaysia Productivity Corporation.

In an earlier MSIA statement, Wong said the recent signing of the US-Malaysia memorandum of cooperation on semiconductor supply chain resilience and the launching of the Indo-Pacific Economic Framework for Prosperity (IPEF), with a dozen initial partners will help lower costs by making semiconductor and electronics supply chains more resilient in the long term.

MSIA said the deal covers Malaysia, Australia, Brunei, India, Indonesia, Japan, South Korea, New Zealand, the Philippines, Singapore, Thailand, and Vietnam, with these 12 countries representing 40% of the world’s GDP.

“The industry is experiencing a period of high growth with digital transformation and emerging technologies such as Internet of Things, artificial intelligence, smart factories and autonomous vehicles.

Semiconductor companies like Intel, Samsung, and TSMC, and countries like China, the US and Europe have announced investments exceeding US$550bil (RM2.4tril) over the past one year in fabrication plants to meet the increasing demand for semiconductors,” said Wong, who added that companies in Malaysia are expanding and increasing capacity to address the current global shortage of semiconductors.

“Malaysia is also attracting new investments to strengthen its supply chain. A more resilient and flexible semiconductor supply chain will allow the industry to manage market volatility much better.

“The industry must steer a course towards a future where sustainable growth can be achieved through resilience and an open, connected world. This is important as semiconductors and electronics has the most complex and geographically dispersed value chain in the world,” said Wong.

He added that the US-Malaysia memorandum of cooperation in semiconductor supply chain resilience and the IPEF is a positive development for the Malaysian semiconductor and E&E industry sector.

“It further consolidates Malaysia’s position as one of the critical global semiconductor hubs.

“Malaysia will continue to be an attractive investment location for semiconductor and E&E companies,” he said.

Last year, Malaysia recorded approved investments of RM148bil, which was 9.5 times the approved investments in 2020, amounting to RM15.6bil.

“The trend for investments is expected to continue with the recent mission by the International Trade and Industry Ministry and its minister to the US,” said Wong.

Formed in January 2021, MSIA is an industry association which covers companies incorporated in Malaysia that are related to the semiconductor industry (electronics and systems) as well as the associated supply chain, including institutions providing significant related services such as engineering, finance, legal, as well as societies, associations, chambers, and government-linked agencies.

To date, it has 180 members from 10 states in Malaysia, with their headquarters based in 17 countries, including the United States, Europe, and Asia.