Kuala lumpur: The investment incentives offered by the government to foreign companies should not be seen as 'paying companies to come', but rather as a strategy to develop an industrial ecosystem, build local talent, and strengthen Malaysia's technological capabilities. Malaysian Investment Development Authority (MIDA) chairman Tengku Zafrul Abdul Aziz said the country seeks investments that have a significant impact on the rakyat and the economy.

According to BERNAMA News Agency, Tengku Zafrul emphasized that the discussion around incentives should not be limited to viewing them as mere payments to attract companies to Malaysia. He highlighted the importance of evaluating whether these incentives yield appropriate returns for the country. To address this, Malaysia has introduced a New Incentive Framework to ensure that incentives are outcome-driven.

Tengku Zafrul cited SkyeChip Sdn Bhd as a successful example of the strategy. SkyeChip, a Malaysian firm, is involved in intellectual property and integrated circuit design for artificial intelligence and high-performance manufacturing. This positions the company in the high-value segment of the semiconductor industry, beyond just assembly.

He shared that SkyeChip's chief executive officer, a Malaysian with over 20 years of experience at Intel, was instrumental in establishing Intel's design center in Malaysia before founding his own company. This showcases how initial foreign investments can lead to the development of a skilled workforce and subsequently result in the formation of local technology companies.

In the early phases of foreign investments, Malaysia benefits from the establishment of factories, which is followed by the nurturing of skilled workers, engineers, and design teams. This progression ultimately enables local talent to create and lead their own Malaysian technology enterprises.