KUALA LUMPUR: Malaysia's semiconductor industry is expected to remain buoyant, supporting the manufacturing sector to grow 4.1 percent this year, said the Economic Outlook 2025.
The report said the manufacturing sector expanded by 3.3 per cent in the first half of 2024 following the higher growth in domestic and export-oriented industries.
The domestic-oriented industries saw a steady growth of 5.9 per cent, fuelled by rising demand, mainly in non-metallic mineral products, basic metal and fabricated products subsector, backed by robust performance in construction activities.
Meanwhile, export-oriented industries recorded a growth of 2.1 per cent, supported by an upturn in demand of the electrical and electronic (E&E) segment, attributed to positive market momentum in the global semiconductor industry.
The sector is projected to grow by 4.9 per cent in the second half of 2024, owing to strengthening domestic demand and improving performance of the external sector.
Within the domestic-oriented industries, growth is expected to remain resilient propelled by consumer-related activities, particularly in food and beverages as well as transportation segments resulting from flourishing tourism activities.
In addition, output for construction-related materials such as metals and cement are anticipated to rise, following acceleration of ongoing infrastructure projects and upcoming development activities.
Within the export-oriented industries, the E&E segment is expected to further improve in line with the uptrend in global electronics demand, supported by evolving innovation as well as improvement in the consumer electronics market.
In addition, increasing demand for Al chips, data centres, next-generation computing and high- performance computing application will further boost Malaysia's semiconductor industry.