THE United States’ reported plan to roll back restrictions on artificial intelligence (AI) chip exports under the Biden administration could offer a significant boost to Malaysia’s AI and data centre sectors, according to industry experts.
Head of investment research at UOB Kay Hian Wealth Advisors Sdn Bhd, Mohd Sedek Jantan, said the anticipated move by the Trump administration may open the door for Malaysia to access advanced AI chips such as Nvidia’s H100 and H200 series—vital for training large language models and developing next-generation data infrastructure.
“It can potentially boost foreign direct investments (FDIs) and export-driven growth for Malaysia,” he told Bernama.
The policy change, still pending final confirmation, comes as part of a broader review of US semiconductor export restrictions that have faced pushback from major technology firms and foreign governments. The so-called “AI diffusion rule,” due to take effect on 15 May, is expected to be shelved.
Mohd Sedek noted that Malaysia’s burgeoning data centre sector—which has already attracted significant investments from global tech players like Amazon Web Services, Microsoft, and Google—stands to gain from relaxed chip access, especially given the country’s competitive advantages.
“Malaysia offers relatively low-cost electricity, political stability, and a strategic location in ASEAN. These factors make it a strong contender in hosting large-scale data infrastructure,” he said.
The move could also align well with Malaysia’s broader economic ambitions. Under the National Semiconductor Strategy (NSS), the government has made clear its intention to shift the semiconductor industry towards higher-value activities, including integrated circuit design and wafer fabrication.
“Access to superior technologies can help Malaysia leapfrog into more innovative segments of the chip value chain, enhancing its total factor productivity and export complexity,” said Mohd Sedek.
Tech giants such as Intel and Infineon have already pledged substantial capital for their Malaysian operations, investing US\$7 billion and RM8 billion respectively in states like Penang and Kedah.
However, while the relaxation of export curbs may lower technological barriers, Mohd Sedek cautioned that it may come with new compliance obligations aimed at preventing unauthorised technology transfers, particularly to China.
“Malaysia has previously been flagged in US policy circles as a potential transhipment hub for dual-use technologies,” he said. “Even if the licensing regime lifts quantitative restrictions, it may impose qualitative controls such as end-user certifications, real-time export monitoring, and tighter enforcement under Malaysia’s Strategic Trade Act 2010.”
These compliance measures, he warned, could add operational burdens for small and medium enterprises (SMEs) in the semiconductor sector, potentially impacting their competitiveness and margins.
Nevertheless, analysts suggest that the strategic opportunity for Malaysia outweighs the regulatory headwinds, positioning the country as a stronger player in the global high-tech and semiconductor ecosystems. - May 9, 2025
