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ETP ANNUAL REPORT 2011
Electrical and Electronics
The Electrical and Electronics (E&E) industry accounts for RM37 billion
or six per cent of the Gross National Income (GNI), RM250 billion or 40
per cent of total exports and provides approximately 522,000 skilled
and semi-skilled jobs
There are currently 1,900 active companies
in this sector, spread across a diverse range
of sub-sectors including the semiconductor
and industrial electronic industries.
E&E has been instrumental in the
development of the Northern Corridor
(semiconductors and industrial electronics),
Klang Valley (sophisticated services), Johor
(logistics intensive E&E manufacturing)
and Sarawak (developing cluster for silicon
substrate manufacturing), contributing
significantly to the socio-economic
development of the relevant communities.
Supplementing the impact of these
industries are emerging sub-sectors such
as solar photovoltaic technology (solar)
and light emitting diodes (LEDs).
However, the E&E sector faces significant
challenges in maintaining growth with
Exhibit 7.1
Exhibit A
15 EPPs in four sectors to deepen capabilities across the value chain
Semi-conductor
Solar
LED
Industrial
Electronics
Source: NKEA E&E Lab Analysis
122
Global or
Regional HQ
EPP 1 EPP 3
growing competition from China, Taiwan,
Singapore and other Asian countries. Over
the last 10 years, E&E’s share of Malaysian
exports has gradually declined. Of greater
significance, however, is Malaysia’s position
in the value chain compared to our
competitors. Malaysia’s E&E sector remains
focussed on assembly, the lower valueadded
part of the industry while countries
like Taiwan, South Korea and Singapore
have captured the higher value-added
activities in research and development
(R&D), design and manufacturing.
To overcome the sector’s challenges,
last year’s Economic Transformation
Programme (ETP) Lab outlined a
programme that provides the necessary
focus on four identified sub-sectors.
These subsectors are integrated circuits,
solar photovoltaics, light emitting diodes
EPP 3
EPP 7
R&D
Design
EPP 11 EPP 15 EPP 11 EPP 12 EPP 14
EPPs growing/entering higher value areas
Mfg (core
components device)
EPP 1
Assembly,
Packaging, Testing
EPPs Strengthening
the base
Sales, Distribution,
Services
EPP 10 EPP 10 EPP 8
EPP 9
EPP 10 EPP 15
EPP 4
EPP 5 EPP 6
EPP 11 EPP 13
EPP 14 EPP 15
and solid state lighting and integrated
electronics. These sectors are selected
based on the high potential to significantly
contribute towards Malaysia’s GNI targets,
due to the presence of private investors
with the necessary skills and expertise.
The E&E sector is also a diverse industry,
offering products that have unique market
characteristics and different global trends.
This diversity has resulted in haphazard
development strategies that focus on
short-term goals rather than a structured
long-term approach that sustains GNI
growth from foreign and local players. As a
result, there is a disproportionate allocation
of attention and resources to established
players, irrespective of their potential to
contribute to sectorial growth for the long
term and efforts to nurture local players in
emerging segments are hampered.
EPP 2
EPP 7
EPP 13
EPPs
Opportunistic