GEORGE TOWN: United States technology giant Broadcom Ltd plans to spend RM4.1 billion to expand its operations in Malaysia over the next 10 years.
International Trade and Industry Minister Datuk Seri Mustapa Mohamed said Broadcom would invest the amount in global production planning, quality management, strategic procurement and logistics management.
He said Broadcom was expected to generate RM65 billion of export revenue by next year once its principal hub, here, was fully operational.
This will make it the largest electronics and electrical (E&E) exporter in Malaysia, said Mustapa at the opening of Broadcom’s global distribution warehouse, here, yesterday.
“Broadcom’s export revenue was expected to greatly surpass Western Digital with its exports alone taking up eight per cent of the overall exports in Malaysia, not only in the E&E sector.”
Western Digital now generates RM20 billion export revenue.
The hub will also support Broadcom’s global subsidiaries in undertaking research and development activities.
This would further strengthen Malaysia’s E&E ecosystem and create vast business opportunities for companies in supporting industries, he said.
Malaysia is now the world’s seventh largest exporter of E&E products with total exports of RM287.7 billion last year, according to the Malaysian Investment Development Authority (Mida).
Mida said the industry had shown an upward trend in export for the past three years, contributing 36.6 per cent to total exports and 44.6 per cent to the total manufacturing exports last year.
The new RM59 million warehouse completes the back-end of Broadcom’s supply chain, shipping more than 90 per cent of its products directly to its customers.
Mustapa said with the warehouse, Broadcom’s global inventory for products manufactured in the US, Taiwan, South Korea, Thailand and Malaysia will be centrally stored here before being distributed worldwide.
“This new facility is undeniably a welcome boost to Malaysia’s logistics industry. Given that 90 per cent of its products will be exported via air freight, it would increase the usage of Malaysia’s airport facility with 300 to 500 million units of products being shipped per week,” he added.
Mustapa said many established E&E multinational corporations found a home in Malaysia, particularly in Penang.
“Since the early years, Mida, which will celebrate its 50th anniversary this year, has made every effort to bring globally renowned corporations, such as Intel, AMD, Osram and HP, to Penang’s shores, and the agency continues to work with the relevant agencies to intensify efforts to ensure that all states in Malaysia, including Penang, continue to receive high levels of investments,” he added.