AI Boom Opens Growth Avenues For Penang SMEs - MSIA
GEORGE TOWN, June 18 (Bernama) -- The artificial intelligence (AI) boom is opening significant growth opportunities for Penang’s small and medium enterprises (SMEs), particularly those supporting the semiconductor value chain, according to the Malaysia Semiconductor Industry Association (MSIA).
Its president, Datuk Seri Wong Siew Hai, said the rapid expansion of AI-related applications had driven strong demand for memory chips, manufacturing equipment, power components, photonics, and advanced packaging.
Strong AI demand has filled production capacity for some memory products until 2027, with new orders extending into 2028 and 2029, benefitting companies involved in components, equipment and manufacturing, some of which were already operating at full capacity, he noted.
“It is a good challenge, but the question is how we continue expanding our capacity to support this growth,” he said during a panel session on Economic Outlook: Opportunities for SMEs in Penang at the RHB Progress Series 2026: Penang Economic Forum here, today.
The session was moderated by RHB Banking Group group chief economist Barnabas Gan Sheng Chong, with RHB Banking Group group treasurer Suzaizi Mohamad Morshid also participating as a panellist.
Wong said Penang has built a comprehensive semiconductor ecosystem, with strengths in assembly and testing, automation, precision machining, and equipment manufacturing, with local SMEs growing alongside multinational corporations. However, he warned that the state and country must continue advancing amid intensifying competition from other regional semiconductor hubs.
“We need to move at super speed, otherwise we will fall behind. Today, the environment is no longer only about low cost or efficiency, but innovation, technology, intellectual property and talent,” he said.
Wong pointed out that local SMEs must acquire capabilities in emerging fields such as high-performance computing, advanced packaging, photonics, and heterogeneous integration to remain competitive as semiconductor technologies evolved rapidly.
He said collaboration with foreign technology companies could give Malaysian firms with access to expertise that is not yet available locally, particularly as companies from China, Europe and other markets explore investment and supply-chain partnerships in Malaysia.
Meanwhile, Suzaizi said prudent liquidity and risk management were increasingly important for SMEs amid rising funding costs, interest-rate movements and foreign exchange volatility.
He said businesses should carefully manage their borrowing tenures and cash flow, while considering suitable hedging instruments to mitigate foreign exchange and interest-rate risks.
“Liquidity remains ample in the system, but businesses need to manage it at an optimal level. Any volatility in the US dollar-ringgit exchange rate can affect cash flow,” he added.
-- BERNAMA
