SimmTech Southeast Asia managing director Jeffery Chun said the decision was made to set up its first large-scale manufacturing plant in Penang as the state has a well-established electrical and electronics (E&E) ecosystem, a great talent pool and an existing customer base.
“It makes a lot of sense for us to choose a region with a strong E&E background as well as access to local businesses and resources.
“This is our first phase of investments. Most of them will be made during the construction project over the next two years,” he told a virtual media briefing on the investment today.
He said the semiconductor Printed Circuit Board (PCB) and packaging substrates factory in Penang would be its first in the Southeast Asian region. The company currently only operates in its home country of South Korea, and China and Japan.
Chun said construction of the factory was expected to be completed by early next year, while operations and shipment of products from the new factory are slated to commence within the first half of next year.
He said despite the Covid-19 pandemic, construction was still ongoing and the company did not foresee any major delays.
“Instead, we see this pandemic as an opportunity for the industry as the increasing trend of online meetings has created stronger demand for semiconductor products. This is a great period for the semiconductor industry as a whole.
“Once it is in full swing, the production capacity (of the plant) in Penang will represent 20% of Simmtech Group’s current combined capacity in South Korea, China and Japan,” he added.
Penang Chief Minister Chow Kon Yeow, who was also present during the virtual media briefing, said Simmtech’s 7.2ha facility in the Batu Kawan Industrial Park was expected to create 1,200 high-value jobs in engineering, manufacturing and quality management segments.
Chow said he was hopeful that Simmtech’s arrival would mark the beginning of a new chapter in the state’s link with South Korea.
He said as the country’s leading E&E hub, Penang continued to be a key pillar of Malaysia’s external trade.
In 2020, the state had recorded RM310 billion in exports and RM110 billion in trade surplus, accounting for 32% and 60% of the country’s total exports and trade surplus respectively.
Chow said Penang’s E&E exports were valued at RM231 billion in 2020, accounting for more than half of the country’s total.
On the investment front, Penang recorded outstanding investment performances for 2019 and 2020, having clocked up RM31 billion worth of manufacturing investments over the said period.
E&E products accounted for 47% of the total manufacturing investments, representing 35% of the country’s total E&E investments, further entrenching the state’s position as the Silicon Island of the East.