Malaysia, the new destination for Chinese chip assembly


Malaysia, the new semiconductor Eldorado? Although the country only accounts for 13% of the assembly market, it is in any case the country China has chosen for the assembly of its chips. As the country is not subject to U.S. sanctions, the Middle Kingdom can be sure of a certain supply through this channel!

Malaysia, the dream destination for Chinese chip assembly?

UNISEM Malaisie

For some time now, the U.S. government has been preventing China from assembling high-end chips. The aim is to prevent the development of the AI sector for military purposes. For this reason, many NVIDIA graphics cards have been banned from the country.

However, a country has to run, and the semiconductor sector has become strategic. That’s why Chinese companies are looking for assemblers to get around these restrictions. And that’s where Malaysia comes in! The country boasts assembly, test and packaging companies such as UNISEM, Malaysian Pacific Industries and Inari Amertron. These companies are even capable of assembling MCM chips.

However, let’s be clear: these companies simply assemble and package. Clearly, these companies are not in charge of wafer production or chip design. The way we see it, China designs its own chips, produces them and sends them out for assembly.

What’s more, these companies have no fear of American wrath, since according to John Chia, President of UNISEM, interviewed by Reuters, these are “perfectly legitimate and compliant” transactions.

Finally, if Chinese companies are turning to Malaysia, it’s for technological reasons. We learn that assembly companies are equipped with sophisticated equipment, while the workforce is experienced and costs are affordable. Secondly, we imagine that good Chinese-Malaysian relations also help.