Penang actively conducting investment, trade missions to cushion impact of US tariffs
GEORGE TOWN: Penang, through its state investment agency InvestPenang, is actively conducting investment and trade missions to foreign countries to reduce the impact of the US tariff hike on the state's economy.
Chief Minister Chow Kon Yeow said the effort is aimed at attracting new investors and seeking new market opportunities including Japan, South Korea, Taiwan, Europe, China and Singapore.
'InvestPenang also participated in various international expos such as Semicon Southeast Asia, Kumamoto Industrial Revitalisation Expo, World Fujian Convention and Exhibition, World Congress on Innovation and Technology and so on.
'This effort can increase Penang's visibility to new markets,' he said in reply to a question from Gooi Hsio Leong (PH-Bukit Tengah) on the efforts made by the state government to deal with the impact of the US tariff hike at the Penang State Legislative Assembly sitting here today.
To improve Penang's position in the semiconductor value chain, Chow said, the state government will maintain its commitment to the National Semiconductor Strategy guidelines and the Penang Silicon Design @5km+ initiative.
Progress will be achieved by nurturing local champions in integrated circuit (IC) design with a total investment for the Penang Silicon Design@5km+ initiative projected at RM120 million over the next five years, he added.
Chow also said the state and federal governments have established matching grants to drive the initiative forward and that the collaboration will position Malaysia, particularly Penang, as a leading player in the IC design ecosystem, driving innovation and economic growth.
To attract and support more IC design players to set up and expand their operations in Penang, the state government is offering an incentive package scheme consisting of subsidies worth up to RM2 million annually for three years to both local and foreign IC design companies based in Malaysia. Chow said.
However, the initiative is dependent on funding allocations from the federal government to ensure full implementation of the programme and support for the growth of the industries involved.
Chow said the state government is working with the federal government to develop a trade adaptation toolkit for industry players. It will include practical resources to help them take advantage of alternative markets under regional trade agreements within Asean as well as existing agreements including the Regional Comprehensive Economic Partnership and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership.
Chow explained that Penang is among the states most likely to be affected by the implementation of reciprocal tariffs as the US is the second highest country on the list of exports from Penang with a value of RM76 billion, which is 17 per cent of the state's total export value in 2023.
'In fact, the country is also Penang's main trading partner with a trade surplus worth RM57.7 billion in 2024. Therefore, the implementation of these tariffs may have a serious impact on Penang and other states in Malaysia,' he said. – Bernama
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