The Malaysian government is stepping up efforts to move Malaysia further up the semiconductor value chain through the MyChipStart program, which aims to develop local integrated circuit (IC) design companies, national news agency Bernama reported on Friday.

Deputy Investment, Trade and Industry Minister Sim Tze Tzin said the initiative is anchored on the National Industrial Master Plan 2030 (NIMP 2030) and the National Semiconductor Strategy (NSS), with a focus on strengthening upstream activities such as semiconductor and IC design, beyond Malaysia’s traditional strength in assembly, testing and packaging.

He noted IC design is a highly complex and capital-intensive segment requiring expensive electronic design automation (EDA) tools, skilled talent and significant funding to bring a chip from concept to prototype, which can cost up to $100 million, posing a major barrier for startups.

He made the remarks after launching the MyChipStart program on Friday.

Sim said the program will be implemented under the 13th Malaysia Plan (13MP), with an annual allocation of about MYR 17 million ($4.28 million) to support local companies across different stages of development, from ideation to validation and testing.

He added that support will include access to costly EDA software and shared facilities at Penang Silicon Design @5km+ in Bayan Lepas, where resources will be centrally located and shared among qualified firms instead of individually owned to improve efficiency.

According to him, companies will undergo an evaluation process, including proof of concept and market viability assessments, before receiving assistance.

Sim said Malaysia currently has only about 20 to 30 IC design companies, underscoring the need to expand the ecosystem and develop more local champions in the sector.

He stressed that MyChipStart is not just a funding initiative but a strategic intervention to reduce entry barriers, stimulate domestic investment and strengthen the semiconductor supply chain.

“Our goal is to build a new generation of local semiconductor champions,” he said.

He also noted that Malaysia remains heavily reliant on foreign direct investment (FDI) in the semiconductor sector and needs to increase domestic intellectual property (IP) ownership to ensure long-term competitiveness.

“By owning the IP, we ensure that the wealth created by Malaysian talent stays in Malaysia and strengthens our position in the global semiconductor industry,” he added.

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