Penang final July 2022. Throughout this occasion, Chipl Media sat down with Edwin Haw, Normal Supervisor and Director of SMC Automation Malaysia, to get his ideas on what transpired throughout the previous couple of years within the business.
Let’s shortly unpack what was shared throughout our dialogue with Edwin Haw.
First, who’s SMC Automation Malaysia? They’re a manufacturing facility automation options supplier that has been round since 1976; that’s an astounding 44 years and counting! With borders opening up and COVID protocols easing, the world is prepared for the world financial system to return to regular.
With Penang’s ecosystem pushed by a major share coming from the manufacturing sector, reopening the EMAX and PMAX expo is a welcome glimpse again into the times earlier than COVID turned the world upside-down.
Haw talks about how SMC Automation tailored in the course of the COVID-reIated lockdowns by logging on to make sure enterprise continuity with their key clients, an effort resonated with many others all through the pandemic.
Like the remainder of the world, many imports and exports had been affected, inflicting additional extensions in lead occasions of supplies and, inevitably, increased prices, primarily as a result of mandates that shut down many operations to comprise the aggressive unfold of COVID.
Then by February 2022, the fragile state of the availability chain was additional exacerbated by Russia’s invasion of Ukraine, and in what continues to be an ongoing struggle, many uncooked supplies within the semiconductor sector counting on provides coming from each Ukraine and Russia have led in direction of straining an already choking provide chain. Logistics suppliers worldwide needed to reroute their flight paths and supply routes to keep away from flying over conflicted air area, all amidst an ongoing pandemic.
In response to this financial disaster, the Malaysian authorities, via MIDA (Malaysia Funding Improvement Authority), developed a number of packages to assist their budding manufacturing sector.
One such program encourages native manufacturing corporations to localize their provide via the native sourcing facilitation program of MIDA. Much like packages like that within the U.S., the diversification and localization of sourcing assist reduce the dependence on different international locations to provide key uncooked supplies and preserve merchandise flowing into cabinets and, ultimately, into customers l procuring carts.
Not solely does this give producers in Malaysia extra flexibility to maintain manufacturing strains transferring, however it additionally gives a much-needed increase to a neighborhood financial system that has undoubtedly suffered financially in the course of the pandemic.
One other program noticed the upskilling of laborers and employees to have the ability to deal with a extra digital and distant office led to by COVID restrictions. This included coaching and expertise adoptions to maintain the workforce updated, albeit remotely. Haw additionally describes how MIDA inspired small native companies to offer their merchandise and repair to the SMEs and MNCs inside Malaysia to spice up the ecosystem. This transfer permits Malaysia’s smaller startups to realize traction by servicing the wants of bigger and multinational firms. An excellent transfer to maintain the Malaysian financial system intact and guarantee corporations can survive the pandemic’s unfavorable monetary impacts.
MIDA has additionally been very energetic in selling investments. In 2020, MIDA attracted almost RM64.8 billion price of investments within the manufacturing, service, and first sectors, thus creating over 1,700 initiatives and 37,000 job alternatives inside Malaysia. Most of the Malaysian efforts centered on strengthening the native enterprise ecosystem.
Almost 70% of these investments had been home direct investments (DDI), whereas the remaining 30% had been overseas direct investments (FDI). After all, the biggest of those investments went into the manufacturing sector, contributing greater than half of the investments, roughly RM35.7 billion or US$7.85 billion going into manufacturing alone.
Haw then talks about how Malaysia also needs to modernize its ports, impressed by Singapore’s monumental announcement of a $14 billion funding to construct a mega port by 2040. One which might be extremely automated and meant to ease the availability chain points at the moment. Haw believes the modernization of their ports will preserve Malaysia aggressive.
MI DA’s efforts to push Malaysia’s enterprise ecosystem additional appear to be paying off because the company not too long ago signed with logistics big, Maersk, to assist flip Malaysia right into a aggressive regional logistics hub, a step in direction of the identical route that Haw envisions for the nation to progress.
Wanting onwards to 2023
The excellent news right here is that the outlook for this 12 months seems promising.
Globally, the electronics market is predicted to develop to $3,521.21 billion in 2022 with a compound annual development charge (CACR) of 10%. Pushed by rising applied sciences in 50, 10T, and electrical autos, this growth, as resonated by Haw, ought to proceed to drive development in 2023. The chip scarcity, nonetheless, isn’t fully gone. The world is slowly recovering from COVID, and enterprise is normalizing.
Though the capability of most semiconductor producers like Intel, Samsung, and others has improved after a sequence of investments, there’ll nonetheless be lingering points throughout the provide chain. Nevertheless, the pressure is barely improved as a result of actions of many large gamers and governments to mitigate the impacts of this scarcity. Suffice it to say, the business isn’t totally out of the woods simply but, particularly with geopolitics presently nonetheless in play.
Within the meantime, be at liberty to discover your semiconductor wants via Chipl Change and go to our web site, https://www.chipl.com/. Comply with us on Fb, Instagram, Linkedln, and You Tube.