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Malaysia looks to produce GPUs, chips in 5-10 years

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Influx of investments boosting economy, says PM

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Malaysia's location strategic for supply chain

diversification

(Recasts; adds minister's quotes, details; paragraphs 6-9)

By Danial Azhar

KUALA LUMPUR, Jan 9 (Reuters) - Malaysia wants to

leverage its location to become an energy and chip manufacturing

hub this year, riding a recent jump in investments and a

favourable outlook for the domestic economy, its premier and

economic minister said on Thursday.

Malaysia is fast becoming a haven in Southeast Asia, with

foreign investors returning as improving growth and a stable

currency set it apart from peers grappling with political flux

and economic uncertainty.

Prime Minister Anwar Ibrahim said Malaysia's economy

rebounded dramatically last year, spurred by an influx of

strategic investments, most substantially in renewable energy

and artificial intelligence infrastructure. He added inflation

and the ringgit were stable and the stock market was the

region's top performer.

"In 2025, we want to double down on our geographical

centrality, as a conduit for electricity, talent and supply

chain diversification," he said at an economic forum.

Anwar said Malaysia will now aim to refine its expertise in

oil and gas, semiconductors, and Islamic finance to become a

global market leader in each field.

Economy minister Rafizi Ramli said Malaysia is looking to

produce its own graphics processing unit chips as demand for

artificial intelligence and data centres grows.

"We are hoping that we can start producing made-by-Malaysia

GPUs and chips in the next five to 10 years," he said.

Malaysia, a major player in the semiconductor industry that

accounts for 13% of global testing and packaging, is targeting

over $100 billion in investment for the sector.

The Southeast Asian country is seen as well placed to

attract more business as Chinese chip firms diversify overseas

for assembling needs, and has attracted multibillion-dollar

investments from leading firms in recent years, including Intel ( INTC )

and Infineon.

Malaysia also received a slew of digital investments from

major tech firms last year, including Alphabet's

Google, helping to propel its economy with growth beating market

expectations in the second and third quarters and the ringgit

becoming one of Asia's top performers in 2024.