Penang should learn from Selangor on how to go from backend chip manufacturing to front-end design work, says Guan Eng

KUALA LUMPUR, April 28 — DAP chairman Lim Guan Eng said today he will be meeting Penang Chief Minister Chow Kon Yeow to seek clarification as to the state’s necessity for an integrated circuit (IC) design park following the loss of the multi-million ringgit project to Selangor despite being able to afford it.

Lim said Penang should participate fully if not take the lead to align itself with Putrajaya’s goal of shifting focus of the local tech sector from backend chip manufacturing to high-value front-end design work.

“I will be meeting Penang Chief Minister Chow Kon Yeow as to why he feels Penang may not need an IC design park or there is no problem not having an IC design park as there are already many related companies in the state.

“With incentives of RM125 million from the Selangor and the federal government and another RM75 million from the private sector, many companies including those from Penang will be attracted to do the front-end IC design work there,” he said in a statement.

Lim said he welcomed Chow’s announcement over the interest by three China-based semiconductor companies who were keen to invest in Penang with total investments of US$100 million which would help bolster the state’s back-end manufacturing ecosystem.

The three companies were China Wafer Level CSP Co, Ningbo SJ Electronics Co and Wuxi AMTE Inc.

But Lim still said Penang should learn from Selangor’s success to set up a semiconductor accelerator and IC design park as such a move would reinforce the northern state’s position as Malaysia’s Silicon Valley.

“Penang should leverage its current lead in back-end’s chip manufacturing to establish front-end IC design work.

“IC design will help to design microchips that are fundamental building blocks for electronic devices from smartphones to supercomputers,” he said.

Last Wednesday, Chow commended the Selangor government and the federal government initiative.

However, he said Penang is committed to strengthening the state’s position as part of the global chip supply chain.

He said the Penang government has remained steadfast in securing strategic investments to boost its economy and solidify its position as a preferred investment destination in the Asia-Pacific region.