As U.S. sanctions pose challenges to China’s chip industry, a rising number of Chinese semiconductor design companies are collaborating with Malaysian firms for the assembly of high-end chips. Focused on graphics processing units (GPUs), these companies seek to diversify and mitigate risks associated with potential U.S. expansions of sanctions. While not violating any U.S. restrictions, the assembly requests highlight concerns about future restrictions on sophisticated technology exports to China.
Malaysia, a major hub in the semiconductor supply chain, is strategically positioned to attract business from Chinese chip firms. Unisem and other Malaysian chip packaging companies have witnessed increased business from Chinese clients. Chinese firms also view Malaysia favorably due to geopolitical considerations, affordability, an experienced workforce, and advanced equipment.
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Credit: Fanny Potkin and Yantoultra Ngui