KUALA LUMPUR: Malaysia should develop its integrated circuit (IC) design industry given the importance of design in sustaining growth in technology, according to Taiwan-based Phison Electronics Corp chief executive officer Datuk Pua Khein-Seng.

The Malaysian, known as the inventor of the USB flash drive, said Malaysia has a lot of design talent, but many are residing overseas given the fledgling design industry here.

“We have to make (the) design (business) sustainable. The best way is by building local (design) startups rather than just having multinational (semiconductor) companies coming here and hiring locals.

“The startups can become profitable or undertake an initial public offering, thus showing some sustainable model story. Then it would attract a lot of student talent from overseas back to the country to help build a seat of technology,” he told Bernama in an interview here.

He expressed hope that Phison can do “something here” but noted that it may be difficult given the preference for attracting factories.

Pua said Malaysia is doing well in the capital-intensive industries, which contribute to high revenue and Gross Domestic Product mainly in manufacturing, but he believes China is catching up in design and Taiwan is ahead.

“At Phison, what we are doing is a design not manufacturing; and to be honest, design can create more value, but in design, you cannot see any return within three years,” he said, adding that the profit can however be attractive.

Saying that design is “the root” of technology, he urged Malaysia to try not only to attract manufacturing businesses but also those involved in design.

Phison, established in 2000, is the world’s largest independent provider of NAND Flash controllers and storage solutions. It has about 3,000 engineers doing storage design for products such as personal computers, gaming consoles and smartphones.

The company has shipped over 600 million NAND controllers worldwide yearly and topped over US$2 billion in sales revenue in 2022.

Phison and Virtual Reality Solution Sdn Bhd (VRS), which are involved in design of ICs for NAND controllers, are keen to collaborate to establish a research and development centre based in Malaysia as well as progressing the cybersecurity growth in Malaysia.

“Malaysia is a kingdom of outsourced semiconductor assembly and test (OSAT) in the semiconductor industry, but I have positive hopes that Malaysia will have a bright chance to move towards IC designing capability in the future, overcoming the middle-income trap for Malaysia and at the same welcome back our talents outside of Malaysia, as well as opening doors to more local talents and creating more job opportunities,” Pua said.-Bernama