Four Southeast Asian countries, including Thailand, Vietnam, Singapore and Malaysia, are vying to turn out to be regional semiconductor leaders. The rapid growth of the worldwide chip sector is being driven by rising demand for artificial intelligence (AI) and electric vehicles, underscoring the sector’s importance within the international market.
Thailand plans to speed up investment within the mining sectors, with a concentrate on semiconductors and batteries. The Board of Investment (BOI) will propose recent measures to the federal government led by Prime Minister Paetongtarn Shinawatra.
BOI Secretary General Narit Therdsteerasukdi has revealed plans to establish a “semiconductor council” that can oversee investment within the sector and encourage firms from the US and Europe to speculate in Thailand in the approaching years.
With a big and comparatively young population, Vietnam is becoming a key player within the Southeast Asian semiconductor supply chain. The Vietnamese government has prioritized the semiconductor sector in its economic planning and is benefiting from foreign interest in alternative outsourcing locations.
As a strategic move, Vietnam is developing a Digital Technology Law (DTI) that gives various incentives to draw global chip firms. The law includes tax breaks of as much as 150% on R&D expenses, free land use for as much as 10 years, and expedited visas for foreign experts. In addition, firms investing greater than $160 million will receive expedited registration and exemptions on certain raw materials and equipment.
The visit of US President Joseph R. Biden in 2023 marked a major turning point, followed by announcements by US firms about local projects in Vietnam. Shortly afterwards, Dutch Prime Minister Mark Rutte visited Vietnam, accompanied by essential investment announcements by Dutch firms.
Since the Nineteen Sixties and Nineteen Seventies, Singapore and Malaysia have strengthened their positions in the worldwide semiconductor supply chain. Singapore recently strengthened its position further after a visit by Indian Prime Minister Narendra Modi.
During a gathering with Singapore Prime Minister Lawrence Wong, Modi signed 4 memoranda of understanding to deepen cooperation in semiconductors, digital technology, skills development and healthcare. Under the agreements, Singapore will support the event of India’s semiconductor industry, while India will facilitate the entry of Singaporean firms and the event of supply chains in its large market.
Despite its small size and high operating costs, Singapore plays a key role in the worldwide semiconductor industry, accounting for 11% of worldwide integrated circuit production and about 20% of semiconductor equipment production.
The country goals to expand its manufacturing sector by 50% between 2021 and 2030 and turn out to be a hub for artificial intelligence (AI). Semiconductors currently account for nearly half of Singapore’s manufacturing output and seven% of its GDP.
As a pioneer of the ASEAN semiconductor industry, Singapore has a highly competitive R&D infrastructure and stays a key global player in advanced manufacturing.
Malaysia can be focused on improving its position in the worldwide semiconductor supply chain. Prime Minister Anwar Ibrahim has stressed the importance of moving into high-value chip production, calling it a “critical goal” and a brand new chapter within the country’s history.
Through the New Industrial Master Plan 2030, the Malaysian government goals to attain excellence in integrated circuit design for electric vehicles (EVs) and artificial intelligence (AI) and attract investment in advanced wafer manufacturing. The Minister of International Trade and Industry will lead a strategic effort to draw “strategic investment” within the semiconductor sector, which currently accounts for nearly half of the country’s industrial export revenue.
As a part of this strategy, Malaysia is specializing in its significant role in the worldwide chip supply chain, where it already contributes 13% to the assembly, testing and packaging sector. The country can be strengthening its position within the end-user sector, particularly in automotive applications. Tesla arrange its regional headquarters in Malaysia last 12 months, and Chinese electric vehicle makers have also invested within the country.
