Malaysia will invest 500 billion ringgit ($107 billion) investment in the country’s semiconductor industry, the country's prime minister Anwar Ibrahim has announced.

In comments made by Ibrahim at an industry event and reported by Reuters, he said the money would be used to support the development of integrated circuit design, advanced packaging, and manufacturing equipment for semiconductors.

He said the country is also seeking to domestically establish 10 design and advanced semiconductor packaging companies, each with revenues between $210 million and $1 billion. Further details about the project are expected to be announced later this year.

"We have a strong capacity to diversify and move higher in the value chain… to move towards even more high-end manufacturing, semiconductor design, and advanced packaging, Ibrahim said.

Currently, around 13 percent of global chip testing and packaging takes place in the country but the government reportedly wants to further establish the country as a leader in semiconductor front-end design.

In recent years, Malaysia has attracted investment from semiconductor companies including Infineon and Intel. In August 2023, Infineon announced it would invest $5.4 billion to expand its power chip plant in the country, while Intel pledged in 2021 to invest $7 billion to build a chip packaging facility in the country.

The news comes a month after the Malaysian government announced it was planning to build the largest integrated circuit design park in Southeast Asia to promote domestic semiconductor design, prototyping, and manufacturing.

To support that project, the Malaysian government said it would offer a number of incentives, including tax breaks, office space subsidies, and visa exemption fees, to attract tech companies and investors to the facility.