KUALA LUMPUR: The semiconductor strategic plan should encompass the industry's ecosystem for Malaysia to achieve its goal of becoming a preferred investment destination for the industry, said an expert.

Putra Business School analyst Associate Professor Dr Ahmed Razman Abd Latiff said it was important for the plan to have investor-friendly policies and enough skilled workers for the industry rather than just being a masterplan.

"It is essential to ensure that the strategic plan encompasses the ecosystem of the industry and that it also covers the supply chain.

"We want to make sure that we will not only have the right infrastructure and facilities, but must also have investor- friendly policies and enough skilled workers for investing companies."

Malaysia must facilitate knowledge transfer to promote innovation, thereby creating added value for companies and the industry, he said.

Yesterday, the National Investment Council instructed the Investment, Trade and Industry Ministry to develop a semiconductor strategic plan to sustain Malaysia's status as a preferred investment destination.

Prime Minister Datuk Seri Anwar Ibrahim said this was crucial to attract semiconductor companies to establish high-quality semiconductor manufacturing facilities.

Centre for Market Education chief executive officer Carmelo Ferlito said while an attempt to preserve Malaysia's competitiveness was welcomed, in particular in a crucial sector like semiconductors, the effectiveness of the masterplan was questioned.

Instead, he said, the government should focus on designing a broad, comprehensive pro-competitiveness bill to establish the nation as a regional investment hub.

"I tend to be sceptical about the usefulness of masterplans, blueprints and strategic plans, which often turn out to be not much more than well-crafted wish lists.

"Instead, the government should move more in the strategic direction of designing a broad and comprehensive pro-competitiveness bill, similar to what Indonesia did with its Omnibus Law.

"In fact, Malaysia should aim to restore its place as a preferred regional investment destination not only for semiconductors, but in general.

"What I have in mind is what was designed in the past with schemes like the principal hub designed by the Malaysian Investment Development Authority and which needs to be upgraded in light of the regulations that came afterwards."

A principal hub is a locally incorporated company that uses Malaysia as a base for conducting its regional or global businesses and operations to manage, control and support its key functions, including management of risks, decision making, strategic business activities, finance, management and human resources.

Ferlito highlighted Malaysia's potential as a regional hub, emphasising the need for a holistic approach that included simplifying business registration, fair taxation, access to labour and a robust banking system.

https://www.nst.com.my/news/nation/2024/04/1039185/semiconductor-strategic-plan-should-include-investor-friendly-policies