Behind the Money

A surprising winner in the US-China chip wars

Apr 3, 2024

Discover how Malaysia has become a surprising winner in the US-China chip wars, attracting global companies to set up chip factories. Explore the challenges and opportunities in Malaysia's semiconductor industry and its strategic positioning in the chip supply chain amidst rising geopolitical tensions.

18:57

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Quick takeaways

Malaysia emerges as a key location for semiconductor manufacturing due to geopolitical tensions and global demand.

Challenges for Malaysia in sustaining semiconductor growth include talent shortages and risks from US-China conflicts.

Deep dives

Penang's Rise as a Semiconductor Hub

Penang, a small island state in Malaysia, is experiencing a boom in semiconductor chips manufacturing. Companies like Intel, Infineon, and Micron are expanding their operations in Penang due to the increasing global demand for semiconductors. This growth is fueled by the ongoing tech rivalry between the US and China, leading to the China plus one trend for diversifying supply chains. Malaysia's neutral geopolitics, strategic location, access to suppliers, and workforce advantages make it an appealing destination for semiconductor production.

Introduction

3min

Malaysia's Semiconductor Success and Future Prospects

3min

Malaysia's Rise in Chip Industry Amid US-China Tech Rivalry and Global Supply Chain Diversification

6min

Challenges and Opportunities in Malaysia's Semiconductor Industry

4min

Malaysia's Strategic Positioning in the US-China Chip Wars

3min

The US and China’s battle for dominance in the semiconductor industry is having some surprising knock-on effects: Companies are looking to insulate their supply chains from rising geopolitical tensions. And many from around the world are setting their sights on Malaysia to set up or expand their chip factories. FT correspondent Mercedes Ruehl explains how the country earned a prized spot in the supply chain, and what it needs to do to keep hold of it.

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For further reading:

Malaysia: the surprise winner from US-China chip wars

Vietnam dangles semiconductor incentives to draw foreign companies

AI boom broadens out across Wall Street

Plus, sign up for the FT’s Alphaville pub quiz on April 9 in New York.

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On X, follow Mercedes Ruehl (@mjruehl) and Michela Tindera (@mtindera07), or follow Michela on LinkedIn for updates about the show and more.

Read a transcript of this episode on FT.com

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