Investment, trade and industry minister Tengku Zafrul Aziz said Malaysia did not want any party to exploit its position as a semiconductor and regional logistics hub for illegal activities.

“We firmly adhere to export control regulations under the Strategic Trade Act, which governs the export, transit, and transhipment of strategic goods, including semiconductors.

“Malaysia’s policy aligns with the control measures implemented by the US, the European Union, and the UK,” he said in an interview with Bernama TV on Wednesday.

To strengthen oversight, he said the government was enhancing international cooperation to monitor the flow of sensitive technology such as the Nvidia H100 and A100 chips used in high-performance AI applications.

Separately, Tengku Zafrul said the success of Chinese tech firm DeepSeek proved that AI was no longer monopolised by a few countries or large companies like Microsoft, OpenAI, or Google.

“We are now seeing China, Alibaba, and perhaps soon India or the EU competing in AI technology.

“Technological advancements like DeepSeek have a positive impact, making AI more inclusive and accessible. If AI can operate at a lower cost, more businesses, including small and medium enterprises, can leverage it to boost productivity,” he said.

He added that AI models that relied less on high-powered graphics processing units could reduce energy consumption, making the technology more sustainable.