**Malaysia Poised to Become ASEAN's Premier Manufacturing Hub in 2025, New Data Shows**

**Malaysia Poised to Become ASEAN's Premier Manufacturing Hub in 2025, New Data Shows**

Recent economic indicators and policy announcements suggest Malaysia is on track to become Southeast Asia's most competitive manufacturing destination by 2025, outpacing regional rivals Vietnam and Thailand in several key metrics.

### **Key Developments Driving Manufacturing Growth**

1. **Semiconductor Sector Expansion**

- Intel's new $7 billion advanced packaging facility in Penang begins operations Q1 2025

- Malaysia's share of global chip testing/packaging expected to reach 18% by year-end

- New National Semiconductor Strategy offers 35% tax credit for equipment purchases

2. **Electric Vehicle Ecosystem Matures**

- First local lithium processing plant operational in Pahang, reducing battery production costs by 40%

- Tesla and BYD expanding local assembly operations

- Government introduces RM2,000/employee training grants for battery technologies

3. **Industrial Policy Innovations**

- New "Golden Visa" program offers 10-year residency for manufacturers investing >RM20 million

- Industry 5.0 incentives include 50% subsidies for AI/robotics integration

- Special border economic zones with Thailand/Singapore to launch pilot programs

### **Comparative Advantages**

- **Cost Competitiveness**:

- Industrial electricity rates 30% below Singapore

- Manufacturing wages 25% lower than Thailand

- **Workforce Development**:

- German-Malaysian Institute to graduate 15,000 precision engineers in 2025

- 92% English proficiency (highest in ASEAN)

- **Infrastructure Readiness**:

- Penang Port's RM2 billion expansion completes Q3 2025

- 98% 5G coverage in industrial zones achieved

### **Challenges and Considerations**

- **Industrial Land Shortages**:

- Premium industrial space in Penang/Klang Valley seeing 120% price increases since 2022

- Government identifying new development zones in Johor and Kedah

- **Global Competition**:

- Vietnam maintaining cost advantages in labor-intensive sectors

- Thailand's EV incentives remain aggressive

### **Expert Analysis**

"Malaysia's unique combination of semiconductor expertise, multilingual workforce, and neutral geopolitics positions it perfectly for 2025's manufacturing landscape," says Dr. Aminah Rahman, Senior Economist at the Institute of Strategic and International Studies. "The window for maximizing incentives is now, before land and talent shortages intensify."

**For further details:**

MIDA Manufacturing Development Division

+603 2267 3633

invest@mida.gov.my

or email us at amazingunitysbamz@gmail.com for enquiry