According to the MSIA 2022 E&E Survey, 50% of the E&E companies surveyed are expecting a decline in orders while 25% are still expecting an increase in orders.
However, 65% of E&E companies are still pushing ahead with planned capital expenditures and investments, as Malaysia has already attracted E&E investments of RM186.2 billion since January 2020.
“This reflects the long-term prospects of the industry and business confidence in Malaysia as a location for semiconductors and electronics,” MSIA said in a statement today.
The survey, produced collaboratively with Deloitte Malaysia, was launched today. It captured the contributions of 93 MSIA members including those in semiconductors and electronics, from manufacturing to services. It also provides a profile on investments, job creation, challenges, priorities and the business outlook of the industry.
At the launch, MSIA president Wong Siew Hai said Malaysia is a key player in the global semiconductor business and accounts for 7% of its total trade and has a 13% global market share in chip testing and packaging.
“E&E is a major contributor to Malaysia’s external trade surplus. It accounts for 78% of Malaysia’s external trade surplus of RM255 billion, and also employs 590,000 Malaysians, and indirectly provides employment for Malaysians in other industries,” he said.
Wong said the E&E sector continues to attract the highest level of investments (foreign direct investment (FDI) and domestic direct investment (DDI)) into the country with a record breaking RM148 billion in 2021, or 76% of Malaysia’s total investment in manufacturing that year.
Despite short-term global economic headwinds, the long-term outlook for semiconductors and electrics continues to be extremely bright.
“E&E industries remained focused on recruiting, retaining and developing talent, as well as on supply chain resilience, digitalisation, Industry 4.0 and ESG initiatives,” its statement said.
With E&E contributing significantly to the economy, it has also moved beyond manufacturing into higher-value and higher-skilled activities like design and development, and global business services.
“Malaysia is the regional and global headquarters for many manufacturing and service activities with many Malaysians holding global and regional leadership roles.”
Wong said the E&E sector is the “golden goose” of Malaysia, and it must be constantly nurtured so the industry remains relevant and competitive.
“There is a window of opportunity for Malaysia to capture investments, business opportunities and sales orders. The government should move quickly to seize it,” he added.