Anwar's Taiwan Comments Shake Confidence in Malaysia Chip Investment

The Taiwan Chamber of Commerce & Industry in Malaysia is warning that Prime Minister Anwar Ibrahim's recent comments on Taiwan could cool future semiconductor investment — even as contractors on the ground say existing plant work has not stopped.

The warning came after Anwar, in an Al Jazeera interview aired in late August, said he saw Taiwan “as part of China, period.” Asked whether he would condemn Beijing if it used force, he said he would use force himself if a Malaysian state tried to secede, to “protect the sanctity and unity of the nation.”

Beijing praised the remarks. Taipei condemned them and said one-sided support for China “could negatively impact Taiwanese businesses' confidence in investing in Malaysia.” Anwar later said Malaysia still wanted a peaceful outcome across the Taiwan Strait, while restating the one-China policy set out when Kuala Lumpur recognized Beijing in 1974.

The chamber said equating Taiwan with a breakaway province “diverges markedly” from the region's long-standing political reality. “The People's Republic of China has never governed Taiwan since its founding in 1949,” it said. Force used to change the status quo “should not be legitimized in the name of ‘internal affairs' or ‘reunification.'” Taiwanese firms, it added, were not asking Malaysia to pick sides. What they watch is whether Kuala Lumpur would stay neutral in a crisis — and that doubt, the chamber said, can “affect future investment planning.”

The commercial stakes are large and narrowly concentrated. Malaysia was Taiwan's fifth-largest export market in 2025, taking about $37 billion in goods. Integrated circuits accounted for $17 billion, up 71.5% from 2024 and nearly 46% of the total. Computers and data-processing equipment jumped 247% to $12.97 billion. Those two lines were about 81% of shipments; adding printed circuits and other semiconductor devices lifts the technology share above 83%, Taiwan's trade data show.

In January–July 2026, Taiwan's exports to Malaysia reached $23.35 billion, with chips at $11.17 billion, or 47.9% of the flow. Two-way trade hit RM147.75 billion in the first half, up 34.7% year on year, the chamber said. Malaysian exports to Taiwan rose 66.5%. Taiwanese manufacturers invested RM3.711 billion across 45 Malaysian projects in 2025, according to the Malaysian Investment Development Authority.

The fit is structural. Taiwan leads in advanced wafer fabrication. Malaysia, Penang in particular, is a major center for assembly, packaging and testing.

That pipeline has not frozen. Ng Boon Teik, chief executive of Penang-based Conwall Construction Industries, which builds semiconductor and other high-tech plants, told Storm Media on 1 September that Anwar's comments were bound to color public debate in Malaysia. He said he had not seen a change in how Taiwanese firms work with local partners.

The contrast that does matter, Ng said, is procurement. Chinese technology groups that put factories in Malaysia seldom hire local builders, bringing contractors from China instead. Taiwanese companies tend to use Malaysian firms. That helps keep construction on schedule and leaves local labor management with the contractor. Ng was speaking at a Storm Media forum in Taipei for Taiwanese chip companies and Malaysian service providers.

Chee Meng Tan, an assistant professor of business economics at the University of Nottingham Malaysia, said the 1974 formula was not new. “What was new was Anwar's statement on the potential use of force, which the one China policy does not explicitly require.”

Industry groups have kept pushing the other way. In May, SEMI Taiwan, SEMI Southeast Asia and the Malaysia Semiconductor Industry Association signed a pact to deepen cross-border investment. Lien Yu-Ping, Taiwan's representative in Kuala Lumpur, used the same event to press Malaysia to update a bilateral investment agreement left largely untouched for more than 30 years.

Taiwan's Chung-Hua Institution for Economic Research has named Malaysia a priority under a “Taiwan Plus One” push to plant trusted capacity across Southeast Asia. It has floated a model in which Malaysian graduates train at parent companies in Taiwan before returning to run local plants. Talent is already moving: 21 Taiwanese firms exhibited at Kuala Lumpur's National Career Fair on 27 June through Contact TAIWAN, with semiconductor and AI employers drawing the heaviest traffic.

A single interview will not unwind a relationship this deep. The chamber's point is narrower, and harder to dismiss. Future chip bets price political risk. Anwar's line on force is now part of that price.

Sources:

Al Jazeera, New Straits Times and Liberty Times （Related： Malaysia Warms to China, Cools on America: Reading Anwar's Pivot ｜ Latest ）