PENANG is well-prepared to adapt to global trade policy shifts by implementing ‘China+1’ and ‘US+1’ strategies, says Chief Minister Chow Kon Yeow.
Chow highlighted that the recent imposition of a 25% tariff on semiconductor imports by United States President Donald Trump presents both challenges and opportunities for Penang.
“Penang, with its robust semiconductor industry and strategic location, is well-positioned to capitalise on the ‘China+1’ and ‘US+1’ strategies as companies seek to diversify their supply chains beyond China and the United States,” he said.
Chow elaborated that the China+1 strategy involves companies expanding their manufacturing and sourcing operations beyond China by incorporating at least one additional country into their supply chain.
“This approach mitigates risks associated with over-reliance on a single market.
“Similarly, the US+1 strategy encourages companies to diversify away from exclusive dependence on the United States by establishing alternative production locations.
“In essence, both strategies aim to enhance supply chain stability by reducing reliance on a single country for manufacturing.
“With Penang’s established infrastructure, skilled workforce, and investor-friendly policies, the state stands as a compelling alternative for multinational corporations seeking to navigate these trade challenges while ensuring supply chain resilience,” Chow explained.
Chow also urged the Federal Government, in Malaysia’s capacity as Asean chair, to lead regional efforts in strengthening Asean-wide cooperation to counterbalance the effects of these tariffs.
“One way of doing it is by speeding up the US-Asean Summit. This would enable Malaysia and the rest of Asean member countries to conduct dialogues and engagements with the US to enhance trade facilitation, reduce amicable trade barriers, and even attract supply chain diversification from global semiconductor firms.
“Malaysia can position itself as a key hub within Asean for high-tech manufacturing and semiconductor production while ensuring Asean members are not left out.
“Strengthening Asean’s regional semiconductor ecosystem will not only help mitigate the risks posed by tariff uncertainties but also reinforce Penang’s position as a prime destination for high-value foreign direct investments (FDIs).
“This proactive approach will ensure that Penang and the broader Asean region remain at the forefront of global semiconductor and electronics supply chains,” he added.
Chow made these remarks during the premiere launch of the documentary Against All Odds: The Rise of Silicon Penang at the official residence of Penang Yang di-Pertua Negeri Tun Ahmad Fuzi Abdul Razak in Seri Mutiara today.
The 40-minute documentary, directed by Image Farm Productions Sdn Bhd filmmaker Loo Shun Ming, is the brainchild of Malaysia Semiconductor Industry Association (MSIA) president Datuk Seri Wong Siew Hai.
Chow emphasised that the documentary encapsulates Penang’s remarkable transformation from a modest state into a global semiconductor powerhouse.
Meanwhile, Wong said the documentary aims to capture the spirit of resilience, vision, and innovation that propelled Penang to its current status as the ‘Silicon Valley of the East’.
“What began as a bold vision decades ago has now evolved into a global success story,” he said.
Also present today were Deputy Investment, Trade and Industry Minister Liew Chin Tong, former Penang chief minister Tan Sri Dr Koh Tsu Koon, and the son of former Penang chief minister Tun Datuk Seri Utama Dr Lim Chong Eu, Lim Chien Cheng.
Story by Riadz Akmal
Pix by Muhamad Amir Irsyad Omar
Video by Noor Siti Nabilah Noorazis