Despite global tensions, Penang semiconductor sector remains resilient says CM

GEORGE TOWN, May 5 — Penang’s semiconductor sector remains stable and has yet to show any significant impact from the ongoing conflict in the Middle East.

Penang chief minister Chow Kon Yeow said the electrical and electronics (E&E) industry, including semiconductors, continues to record encouraging performance despite global economic disruptions.

He said demand for semiconductor products remains strong, driven by rapid advancements in emerging technologies such as artificial intelligence (AI) and global digitalisation.

“I believe the E&E and semiconductor sector remains robust,” he said in a press conference after witnessing the signing of a memorandum of understanding (MoU) between the Penang Convention and Exhibition Bureau (PCEB) and Marriott International Malaysia here today.

He said the state expect demand to continue to rise.

Earlier, senior political advisor to the Prime Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz reportedly said the effects of the global supply crisis are expected to be felt by Malaysians within the next one to two months.

Chow said current technological developments are a key driver of the sector’s growth, boosting investor confidence to continue investing in the state.

He said although geopolitical conflicts could potentially affect global supply chains, Penang has so far not faced any serious disruptions in industry operations.

“If there is any impact, it may be in logistics, such as slightly higher shipping costs, but overall the sector remains strong,” he said.

He said the state government remains optimistic about the semiconductor industry’s prospects in the medium and long term.

“Penang’s position as a key E&E hub in Malaysia continues to attract multinational companies and foreign investors,” he said.

“With technological shifts such as AI and digital innovation, we see this demand remaining and continuing to grow,” he added.

He said the state government will continue to monitor ongoing developments, including any risks arising from global conflicts that could affect the local economy.