By Danial Dzulkifly
SHAH ALAM, July 6 — Malaysia must build a complete semiconductor industry, not just manufacture chips, if it wants to compete globally, said newly appointed Selangor Information Technology and Digital Economy Corporation (Sidec) strategic adviser Chiang Shang-Yi.
He said efforts like Selangor’s Integrated Circuit (IC) Design Park must be backed by a clear national strategy, strong government support, and incentives to encourage early adoption by private entities.
Chiang praised the federal and state governments for supporting all stakeholders in the industry, not just big chipmakers, but also smaller companies and startups that rely on the same infrastructure.
“This is one reason why the entire ecosystem matters far more than what any single company can achieve.
“What Malaysia is doing is quite promising, as it’s supported by both the federal and state governments,” he said in a recent interview with the Malaysian media at the IC Design Park 1 in Puchong.
The former Taiwan Semiconductor Manufacturing Co (TSMC) executive said government support, such as tax incentives and infrastructure, makes it significantly easier for companies to succeed.
He added that building the right foundation could multiply Malaysia’s returns on investment by driving economic growth and creating more high-value jobs.
[caption id="attachment_406463" align="aligncenter" width="1200"]
Newly appointed Selangor Information Technology and Digital Economy Corporation (Sidec) strategic adviser Chiang Shang-Yi is interviewed by Media Selangor at the Sidec headquarters in Subang Jaya on July 3, 2025. — Picture by REMY ARIFIN/MEDIA SELANGOR[/caption]
Learning from TSMC’s journey
Drawing from his years at TSMC, where he helped develop the company’s chip-on-Wafer-on-Substrate technology, Chiang said even with such a high-performance product, it was difficult to convince major chip makers to adopt the solution.
He said while many are impressed with the technology’s performance, they were reluctant to commit when it came to placing actual orders.
The companies, Chiang said, wanted much lower profit margins and expressed concerns about depending on just one supplier.
The breakthrough finally came when a small IC manufacturer took the plunge and placed a modest order.
This gave Chiang’s team the confidence to develop a lower-cost solution called Integrated Fan-Out packaging (InFO), which delivered the same performance while cutting production costs to just one cent per square millimetre.
“They’re great, and now it’s selling like hotcakes in the market. It brings in a couple of billion dollars in revenue every year.”
Chiang said building customer trust takes time, as companies are naturally cautious and risk averse, but believes Asia’s work culture gives the region a competitive edge in chipmaking.
In Taiwan, he explained, engineers will rush to the factory even at 1am in the event of an emergency, and production lines keep running through holidays.
Meanwhile, United States facilities often shut down between Christmas and New Year, losing valuable productivity.
Looking at Malaysia’s potential, Chiang said the country’s neutrality and existing strengths in areas like specialised substrates and battery components put it in a good position to succeed.
“Made in Malaysia, by Malaysians: it’s a good idea and a good place.”
In his capacity as Sidec adviser, Chiang will provide his perspective on how to further develop local semiconductor firms, including on viable business models.
