Malaysia Partners with Arm Holdings to Boost AI Chip Production Capabilities

Malaysia signs deal with Arm to bolster chip ambitions

KUALA LUMPUR (AFP) - British chip giant Arm Holdings signed an agreement with Malaysia yesterday to bolster the Southeast Asian country's efforts to produce high-end semiconductors amid the United States (US)-China tech trade war. Malaysia is a key player in the vital chips sector but has been largely focused on packaging, assembly and testing services - the lower end of the market. The agreement will see Softbank-owned Arm provide chip designs and other technology, helping Malaysia to move into more value-added production such as wafer fabrication and integrated circuit design. The Southeast Asian nation is paying USD250 million over a decade to receive support from the British company, journalists were told at a briefing by Malaysia's Economic Ministry. "Through a comprehensive partnership with Arm, we have conceived one of the most ambitious technological plans Malaysia has ever seen - to pioneer Made-by-Malaysia artificial intelligence (AI) chips," Prime Minister Anwar Ibrahim said in remarks before witnessing the signing. "These chips will be designed, manufactured, tested and assembled here, and sold to the rest of the world." In addition, Arm will also establish its first office in Southeast Asia in Kuala Lumpur, aiming to expand the company's reach in the region as well as Australia and New Zealand, Anwar said. "We won't let you down. This is going to be an extremely exciting 10 years and more," said Arm chief executive Rene Haas. Malaysian Economy Minister Rafizi Ramli said the collaboration would enable Malaysia and Arm "to build a complete supply chain in advanced industries such as AI data servers, autonomous vehicles, IoT (internet of things), robotics and others". He said that around 10,000 local semiconductor engineers would be trained under the deal. Asia Pacific regional director at datacenterHawk Dedi Iskandar said the agreement would make Malaysia "as one of the elite countries in Asia-Pacific that possess advanced AI chip design capabilities other than Taiwan, and Singapore". "Malaysia is laying the red carpet and showing the world that they are serious in this tech war," he told AFP. A prominent player in the industry for decades, Malaysia accounts for an estimated 13 per cent of global back-end manufacturing, according to German tech firm Bosch. Malaysia's northern island of Penang, home to a number of facilities, is often dubbed the country's Silicon Valley. And in April 2024, Anwar announced plans to build a massive semiconductor design park, an effort to move Malaysia beyond chips production.

Malaysia signs deal with Arm to bolster chip ambitions

British chip giant Arm Holdings signed an agreement with Malaysia on Wednesday to bolster the Southeast Asian country's efforts to produce high-end semiconductors amid the US-China tech trade war. Malaysia is a key player in the vital chips sector but has been largely focused on packaging, assembly and testing services -- the lower end of the market. The agreement will see Softbank-owned Arm provide chip designs and other technology, helping Malaysia to move into more value-added production such as wafer fabrication and integrated circuit design. The Southeast Asian nation is paying $250 million over a decade to receive support from the British company, journalists were told at a briefing by Malaysia's economic ministry. "Through a comprehensive partnership with Arm, we have conceived one of the most ambitious technological plans Malaysia has ever seen -- to pioneer Made-by-Malaysia AI chips," Prime Minister Anwar Ibrahim said in remarks before witnessing the signing. "These chips will be designed, manufactured, tested and assembled here, and sold to the rest of the world." In addition, Arm will also establish its first office in Southeast Asia in Kuala Lumpur, aiming to expand the company's reach in the region as well as Australia and New Zealand, Anwar said. "We won't let you down. This is going to be an extremely exciting 10 years and more," said Arm chief executive Rene Haas. Red carpet Malaysian Economy Minister Rafizi Ramli said the collaboration would enable Malaysia and Arm "to build a complete supply chain in advanced industries such as AI (artificial intelligence) data servers, autonomous vehicles, IoT (internet of things), robotics and others." He said that around 10,000 local semiconductor engineers would be trained under the deal. Dedi Iskandar, Asia Pacific regional director at datacenterHawk, said the agreement would make Malaysia "as one of the elite countries in Asia Pacific that possess advanced AI chip design capabilities other than Taiwan, and Singapore." "Malaysia is laying the red carpet and showing the world that they are serious in this tech war," he told AFP. Tensions between Washington and Beijing over advanced tech, especially semiconductors, in recent years have forced many firms to look into relocating their manufacturing from China to other countries including Malaysia, Vietnam and India. "This deal creates equilibrium to the region as Taiwan is always a sore thumb between China and US tech war, and Malaysia are friends to both of them," added Dedi. A prominent player in the industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech firm Bosch. Malaysia's northern island of Penang, home to a number of facilities, is often dubbed the country's Silicon Valley. And in April 2024, Anwar announced plans to build a massive semiconductor design park, an effort to move Malaysia beyond chips production.

Malaysia to pay Arm Holdings $250 million for chip design blueprints

KUALA LUMPUR, March 5 (Reuters) - Malaysia will pay Arm Holdings $250 million over 10 years to acquire the firm's chip design plans for local manufacturers, the government said on Wednesday as it looks to produce its own chips within the next decade amid an AI boom. The Southeast Asian nation plans to produce its own graphics processing unit chips in the next five to 10 years as demand for artificial intelligence and data centres grows. Economy Minister Rafizi Ramli said the government will pay Arm for its intellectual property, including seven of its high-end chip design blueprints. The deal will also involve the training of 10,000 engineers in Malaysia, Rafizi told media ahead of the deal's formal announcement. Malaysia hopes the deal with Arm will allow domestic producers to scale up, creating 10 local chip companies with yearly revenue of $1.5 to $2 billion each, Rafizi said. The economy ministry and Arm will each have a set of selection criteria for the local companies, given the value of the intellectual property involved and to ensure successful production, Rafizi added. The government will identify local companies with the capabilities and expertise to quickly begin manufacturing. A host of technology giants, including Microsoft, Nvidia, Alphabet unit Google, and China's ByteDance, have announced billions of dollars of digital investments in Malaysia since 2023, mostly in cloud services and data centres, powering an infrastructure boom driven by growing AI demand. Last April, Malaysia said it planned to build Southeast Asia's largest integrated-circuit design park and would offer incentives including tax breaks, subsidies and exemption from visa fees to attract global tech companies and investors. Prime Minister Anwar Ibrahim said the park will house world-class anchor tenants and collaborate with global companies such as Arm.