Malaysia's anti-corruption agency said Wednesday it was probing alleged abuse of power, fraud and governance issues linked to a 1.11bn ringgit ($280mn) deal between the Malaysian government and British chip giant Arm Holdings.
The Southeast Asian country, which is one of the world's top chip exporters, signed an agreement with the firm last March to boost production of high-end semiconducters, as the US-China tech trade war shook global markets.
"We have summoned a total of 12 witnesses so far from various government agencies, especially from the economy ministry, Malaysia's investment development authority and also from the trade ministry and several other agencies," Malaysia’s Anti-Corruption Commission (MACC) chief Azam Baki said.
A former minister was one of those called in to give a statement, Azam said, refusing to name the individual.
Rafizi Ramli was Malaysia's economy minister at the time, while Tengku Zafrul Aziz held the investment, trade and industry minister portfolio.
Malaysia is a key player in the vital chips sector but has been largely focused on packaging, assembly and testing services — the lower end of the market.
The Arm Holdings agreement will see the Softbank-owned firm provide chip designs and other technology to Malaysia, helping the nation shift into more value-added production, such as wafer fabrication and integrated circuit design.
Malaysia said at that time it would pay $250mn over a decade to receive support from the British company.
"We will investigate this matter in a fair and professional manner," Azam said, adding that more witnesses will be summoned to assist the probe.
Malaysia's semiconductor exports were valued at 387.98bn ringgit ($87.48bn) in 2024, the Malaysia External Trade Development Corp said, making the country one of the world's top 10 chip exporters.
Malaysia's northern island of Penang, home to a number of facilities, is often dubbed the country's Silicon Valley.
Prime Minister Anwar Ibrahim announced plans in April 2024 to build a massive semiconductor design park, an effort to move the country beyond chips production.
