Malaysia has announced a $250 million agreement with Arm Holdings, spanning 10 years, to acquire chip design blueprints for local manufacturers. The deal aligns with the country’s ambition to develop its own graphics processing unit (GPU) chips within the next five to ten years, amid rising demand for artificial intelligence (AI) and data centers.
Prime Minister Anwar Ibrahim stated that the partnership would enable Malaysia to design, manufacture, and distribute AI chips globally. As part of the deal, Arm will establish its first Southeast Asian office in Kuala Lumpur, serving as a hub for regional expansion, including Australia and New Zealand.
Arm CEO Rene Haas emphasized Malaysia’s strong foundation in the semiconductor industry, citing its expertise in advanced packaging, assembly, and manufacturing. Economy Minister Rafizi Ramli revealed that the agreement covers seven high-end chip designs and includes a training program for 10,000 engineers.
The initiative aims to strengthen Malaysia’s semiconductor ecosystem by fostering 10 local chip companies, each projected to generate annual revenues between $1.5 billion and $2 billion. The government plans to develop a complete supply chain for AI servers, autonomous vehicles, IoT, and robotics, prioritizing local firms for key production roles.
Since 2023, global tech giants such as Microsoft, Nvidia, Google, and ByteDance have invested billions in Malaysia’s digital infrastructure, particularly in cloud services and data centers. The country is also constructing Southeast Asia’s largest integrated-circuit design park, offering tax breaks and subsidies to attract international tech players, with Arm expected to play a central role.
