Commentary: Why Putrajaya Should Deepen Its Ties With The White House

BusinessToday

a day ago

As the global order undergoes a profound reconfiguration driven by technological competition, supply chain shifts, and digital transformation, Malaysia finds itself at a crossroads. It can either remain a peripheral actor in the emerging global technology architecture or assert itself through deliberate, strategic partnerships. Among these, its relationship with the United States warrants deeper engagement. Contrary to outdated perceptions of alignment politics, closer ties with the United States today offer Malaysia an avenue to strengthen its position in key sectors such as semiconductors, artificial intelligence (AI), and cultural and educational exchange. This is not merely a matter of foreign policy optics—it is a pragmatic response to structural shifts in the global economy.
Malaysia plays a pivotal role in the global semiconductor supply chain. With approximately 7% of global trade in semiconductors passing through the country, Malaysia is not a marginal contributor but an essential node—particularly in backend processes such as assembly, testing, and packaging. American semiconductor giants including Intel, Broadcom, and Texas Instruments have long-standing operations in Malaysia, particularly in Penang and Kulim. These operations have generated employment, contributed significantly to national exports, and created ancillary ecosystems of suppliers and talent. However, global trends suggest that this position cannot be taken for granted. The United States is increasingly reconfiguring its semiconductor supply chains under the CHIPS and Science Act, investing heavily in domestic capacity while simultaneously seeking dependable international partners for resilience and redundancy.
Malaysia must proactively present itself as one of those trusted partners. Deepening engagement with the U.S. in the semiconductor sector could involve expanding bilateral investment, establishing more advanced manufacturing capacities, and encouraging joint research initiatives. The move from being a base for low-cost assembly to becoming a site for high-value semiconductor design and innovation should be a strategic policy objective. This requires not only capital investment but also policy alignment in intellectual property protections, trade facilitation, and talent development. The United States remains one of the most technologically advanced countries in the world, and Malaysia has the opportunity to benefit from a transfer of knowledge, capital, and credibility by working more closely with American firms and institutions.
Beyond semiconductors, artificial intelligence represents the next frontier of economic transformation. The U.S. leads the world in AI development, hosting the most advanced large language models, machine learning algorithms, and AI infrastructure. Companies such as Google, Microsoft, Meta, and Nvidia are not only commercial entities but research engines that shape the global discourse on AI ethics, safety, and innovation. Malaysia, which has identified AI as a national priority through its National Artificial Intelligence Roadmap (2021–2025), stands to gain from direct collaboration in this area. Strategic engagement with U.S. institutions could include university-level research partnerships, AI workforce development programs, and policy coordination on digital governance.
In this respect, Malaysia must move beyond a passive adoption of foreign technology and toward co-creation. Joint ventures and research consortia with American universities and firms would accelerate Malaysia's domestic capacity to develop and deploy AI solutions in key sectors such as healthcare, education, agriculture, and urban planning. This also creates pathways for Malaysian talent to gain exposure to frontier research and for the country to contribute to the shaping of global AI norms. Furthermore, participating in discussions on AI ethics and data governance through U.S.-led international platforms would help ensure that Malaysia is not merely a consumer of global standards but an active contributor to their formation.
Cultural and educational engagement between Malaysia and the United States has long been a quiet strength of the bilateral relationship. Thousands of Malaysian students have studied in the U.S., often returning with skills, perspectives, and networks that enrich domestic institutions. American cultural diplomacy—through centers, exchanges, and educational programs—has contributed to soft power influence that complements economic and technological cooperation. In an increasingly interconnected world, this dimension of the relationship is more important than ever. Investing in people-to-people ties helps build the trust and familiarity needed to support more complex partnerships in business and governance.
Expanding these engagements should be a deliberate policy goal. Increasing the number of Malaysian scholarships tied to science, technology, engineering, and mathematics (STEM) fields at U.S. universities could directly benefit the country's industrial ambitions. Encouraging institutional partnerships in areas such as public health, green technologies, and public policy could also generate shared research outputs and policy innovation. Additionally, fostering platforms for civil society, youth leadership, and entrepreneurship exchanges can serve to embed bilateral cooperation across layers of society—not just at the governmental or corporate level.
By Pravin Periasamy, Networking and Partnership Director of Malaysian Philosophy Society Related