Kuala lumpur: Taiwan is looking to strengthen collaboration with Malaysia in the semiconductor and smart manufacturing sectors, particularly in data centres and robotics, by leveraging the complementary strengths of both economies across the semiconductor value chain. The collaboration is underpinned by strong complementarities across the semiconductor value chain, with Taiwan specialising in chip design and fabrication, while Malaysia plays a key role in packaging and testing.
According to BERNAMA News Agency, Director of the Taipei Economic and Cultural Office in Malaysia, James Chang, highlighted that Taiwan remains a global leader in semiconductor design and fabrication, while Malaysia plays a crucial role in packaging and testing. Chang emphasized Taiwan's expertise in integrated circuit (IC) design and chip fabrication, citing Taiwan Semiconductor Manufacturing Company Ltd (TSMC) as a leader in the field. He also noted Malaysia's global standing in packaging and testing, ranking fourth worldwide.
Chang spoke on the sidelines of SEMICON Southeast Asia 2026, held from May 5 to 7 at the Malaysia International Trade and Exhibition Centre (MITEC). He pointed out the significant opportunities presented by this complementarity, especially in emerging segments such as robotics and artificial intelligence (AI), which require both high-end and traditional chips.
He further explained that high-end graphics processing units (GPUs), primarily manufactured in Taiwan, are utilised in AI data centres. At the same time, robotics requires sensors and controllers, areas where Malaysia has the potential to participate actively.
Chang also mentioned that global supply chain diversification, including 'Taiwan Plus One' strategies, has led more Taiwanese firms to expand into Malaysia. Taiwanese investors typically focus on localisation, working with local suppliers and transferring technology rather than relying heavily on imported expertise.
In discussing the data centre boom in Malaysia, Chang said Taiwanese companies contribute through server manufacturing and ecosystem development. He cited a Taiwanese firm in Johor that manufactures servers for regional and global markets and actively builds a local supplier network to support the ecosystem, helping local companies upgrade their technological capabilities.
However, Chang identified several challenges that need addressing to sustain growth, such as talent mobility and policy coordination. Attracting high-tech investments requires the ability to bring in experienced foreign engineers to train local talent, necessitating coordination between human resources, immigration, and investment authorities.
He also proposed updating the bilateral investment agreement between Taiwan and Malaysia, originally signed in 1993, to reflect modern industry needs, emphasizing the importance of intellectual property protection.
Industry players from Taiwan expressed confidence in Malaysia's growing semiconductor ecosystem, driven by AI demand and increasing investments in the northern and southern regions. Hanbell Precise Machinery Co Ltd general manager Hong Sheng Fang highlighted the benefits of their advanced dry screw vacuum technology in reducing costs through improved energy efficiency and extended operational lifespan.
Bossmen Inc export manager Lewis Liu noted strong demand for their precision microenvironment control solutions in semiconductor manufacturing, citing the increasing enquiries from Penang and Johor as an indicator of the right time for expansion.