Why Penang

Setting up in Penang

Your choice location

Penang’s competitive edge lies in its skilled workforce, robust supply chain, top-notch infrastructure and government support, making it a preferred destination for investments.

Robust Ecosystem

More than 350 MNCs & 4,000 SMEs
  • A diverse spectrum of companies across various industry clusters forms a robust network, with SMEs playing a pivotal role in supporting the operations and growth of these MNCs
Established Clusters of Sectors & Supply Chain Ecosystem
  • Home to strong and continually expanding industry clusters, with primary focus on sectors such as Electrical and Electronics, Machinery & Equipment and Medical Devices
Thriving Digital Global Business Services (DGBS) & Centre of Excellence (CoE) for MNCs
  • Malaysia emerges as significant player in offshoring market in Asia Pacific, holding 8% share in the region according to the 2023 Kearney Global Services Location Index
  • Penang now emerged as major offshoring hub with built up offices in Bayan Lepas, becoming prime investment destination for DGBS activities, research and development, and technology hub
  • Penang now houses over 200 Malaysia Digital status companies

Competitive Advantage

50 Years of Industrial Excellence
  • Has a rich industrial legacy spanning over five decades, with its industrial presence heralded in the 1970s
  • Accelerated development shaped by the 8 pioneer investors, including Intel, Hewlett Packard (now Agilent Technologies), Robert Bosch, AMD, Osram Opto Semiconductor (formerly Litronix), Renesas (formerly Hitachi), Clarion, and National Semiconductor (which has undergone corporate mergers and acquisitions)
Highly Competitive Cost of Doing Business
  • Offers one of the most cost-effective business environments in Asia, with notably affordable utility rates covering electricity and water
  • For detailed information on our competitive cost structure, please refer to our Cost of Doing Business
Strong Intellectual Property (IP) Protection & Active IP Creation
  • Places a high value on IP protection, supported by a range of policies and regulations that ensure a healthy environment for innovation
  • Malaysia is signatory to key international IP treaties, including the World Intellectual Property Organization (WIPO) 1967, the Paris Convention for the Protection of Industrial Property 1883, the Berne Convention for the Protection of Literary and Artistic Works 1886, the Trade-related Aspects of Intellectual Property Rights Agreement, and the Patent Cooperation Treaty 1970
Penang - Silicon Valley of the East
  • Contributes over 5% of global semiconductor sales
  • Houses 3 of the global top 10 semiconductor leaders
  • Asia’s Next Silicon Valley awarded by BBC in 2018
MedTech Hub for Asia
  • Houses 6 of the global top 30 medical device companies
  • Has the highest concentration of MedTech companies in Malaysia and Southeast Asia

Future-Ready Talent

Workforce with Multilingual Proficiency
  • English, Malay, Mandarin, Tamil, Japanese, and Korean-efficient talent and population, enabling efficient communication and collaboration on a global scale
  • Malaysia is ranked 25th out of 113 countries for English proficiency, according to the EF English Proficiency Index 2023
Diverse Institutions of Learning
  • Offers a rich educational landscape with over 40 learning institutions spanning various levels of education and focus areas
  • These include four universities, more than 20 university colleges, and five industrial training institutes, among others
Engagement in STEM Education & Talent Attraction
  • Actively engaged in STEM (Science, Technology, Engineering and Mathematics) education and talent attraction, supported by key initiatives
  • The Penang STEM 4.0 Initiative, which encompasses institutions such as the Penang Skills Development Centre (PSDC), Penang Science Cluster (PSC), Penang Math Platform (PMP), Tech Dome Penang, and Penang Digital Library
  • The Penang Future Foundation, an initiative by the Penang State Government, which awards scholarships to deserving students in STEM & Accounting fields, with the requirement that they become part of Penang’s diverse talent pool upon graduation
  • The Penang Internship Subsidy Programme, offering allowance subsidies to local companies for hiring interns, contributing to workforce development and industry collaboration
Skilled Workforce
  • Strong educational infrastructure produces a steady stream of highly skilled professionals
  • Well-educated and adaptable workforce is a significant asset for businesses operating in the region

Sustainable Infrastructure & Accessibility

Road & Train Network
  • Access to the arterial road network of Peninsular Malaysia via the North-South highway
  • Penang Island connects seamlessly to the mainland through two key bridges: the Penang Bridge (a 15-minute drive) to the north and central Seberang Perai, and the Sultan Abdul Halim Muadzam Shah Bridge (a 20-minute drive) to the south Seberang Perai
  • The double-track railway at Butterworth connects Penang to Southern Thailand and Gemas (Negeri Sembilan-Johor border), facilitating both regional and national connectivity
Flight Access
  • Penang International Airport (PIA) hosts 19 international airlines servicing 16 global destinations through 514 flights weekly
  • Expansion projects worth RM1.5 billion ongoing for PIA to be the second largest airport in Malaysia with a handling capacity of 12 million passengers per annum by 2Q 2028
  • 2nd largest cargo hub in Malaysia, with a capacity of handling over 200,000 tons of cargo annually
Seaport Network & Cruise Tourism
  • 5th largest seaport in Malaysia, featuring 26 berths
  • Berth capacity is at 2.3 million twenty foot equivalents (TEUs) per annum
  • Busiest harbour in Malaysia for cruise shipping
Internet Connectivity
  • First state in northern region to have 5G network coverage
  • In 2023, 5G coverage in Penang has reached 73.4% of populated areas
  • The 5G network in Penang is expected to cover more than 80% Coverage of Populated Areas (COPA) by 2023
World Class Technology Parks
  • InvestPenang, in collaboration with Penang Development Corporation, has successfully driven the development of key industrial parks
  • Bayan Lepas Industrial Park, the nation’s first free-trade zone, paved the way for the establishment of more industrial areas, including Batu Kawan Industrial Park, Penang Science Park, Penang Science Park North, Bukit Minyak Industrial Park, Bukit Tengah Industrial Park, Seberang Jaya Industrial Park, Perai Industrial Park, Mak Mandin Industrial Park, Bandar Cassia Technology Park, Penang Technology Park @ Bertam, among others
  • Batu Kawan Industrial Park, Penang’s third satellite city, is home to globally renowned corporations such as Bosch, Micron, Dexcom, Lam Research, Boston Scientifics, Smith+Nephew, Western Digital, Honda and Hotayi as well as homegrown establishment such as ViTrox, Inari and UWC
  • Penang IC Design & Digital Park launched in 2024 to create a vibrant ecosystem to foster innovation and attract global and local IC design players to operate in Penang, encompassing a total of 1 million square feet of premium office space to cater to high-impact activities including IC Design, R&D, DGBS, and digital technologies investments

Proven Economic Performance

GDP at RM116 billion (2023)
  • Manufacturing sector occupying 46.5% while services sector covering 48.0%
7.4% of national GDP (2023)
  • 5th largest contributor in Malaysia, and top in Northern Region
3.3% real GDP growth (2023)
  • 5th largest contributor in Malaysia, and top in Northern Region
Strong export performance with trade surplus of RM150 billion in 2023
  • Export volume for 2023 valued at RM435 billion, backed by strong export-oriented manufacturing industries
Top 5 recipients of manufacturing FDI for the past decade
  • In 2014-2023, Penang garnered RM195 billion in approved manufacturing FDI which represented 30% of Malaysia’s total

Liveable & ESG-Centric City

Liveable & ESG-Centric City
  • George Town, a UNESCO Heritage site since 2008
  • Malaysia’s Most Livable City awarded by ECA International
    in 2019
  • Medical Travel Destination of the Year awarded by International Medical Travel Journal in 2020
  • Penang Hill, a UNESCO biosphere reserve since 2021
  • 3rd Best Island to Retire On awarded by International Living in 2021
  • The Best Destination to Go awarded by CNN Travel in 2022
  • Four times consecutive ASEAN Clean Tourist City Award recipient since 2018
  • Work – Live – Play balanced lifestyle with excellent healthcare, education and housing options
  • A food paradise
Safety & Technological Advancements
  • Penang is one of the safest cities in Malaysia, leveraging advanced technology like CCTV with facial recognition by IBM, the first of its kind in the country
  • Penang 2030 vision to improve environmental, financial, and social aspects of urban life with smart city initiatives
Green Initiatives & Sustainability
  • Penang is a pioneering state in green initiatives, having initiated the “No Free Plastic Bag” campaign in 2011, which inspired nationwide efforts to reduce plastic waste
  • The adoption of the Penang Green Agenda through 2030 solidifies the state’s commitment to sustainability and green practices
  • The implementation of Penang Green Industry Programme, with the aim to reduce environmental impacts of production and consumption from the E&E sector; improve productivity, environmental performance, and competitiveness of E&E sector; and transform Penang into a Green Industrial Hub
Green Zone
  • Safe from major natural disasters due to its strategic location in Straits of Malacca