PUTRAJAYA (Feb 23): Malaysia’s agreement with UK-based chip design firm Arm Holdings plc will remain in force despite an ongoing graft investigation into the deal.
The agreement signed with Arm was a Cabinet decision and the deal is crucial for Malaysia’s long-term semiconductor strategy, Economy Minister Akmal Nasrullah Mohd Nasir told reporters at the sidelines of the official launch of the 2026 Economic Census on Monday (Feb 23).
“At the ministry level, we are giving full cooperation to the investigation, including providing documentation and facilitating the process,” he said. “At the same time, the agreement was a policy decision made at the Cabinet level.”
The agreement is now under investigation by Malaysian authorities after three Malay non-governmental organisations lodged a report, without providing evidence, alleging misappropriation related to the investment.
Under the deal signed in March 2025, Arm would receive US$250 million (RM972.75 million) over 10 years from the Malaysian government in exchange for intellectual property licences and computer subsystem designs, which will be made available to domestic electrical and electronics companies.
On Monday, Akmal Nasrullah acknowledged that the probe carries reputational risks, particularly in maintaining investor confidence.
“One of our concerns is ensuring investor confidence is not affected,” he said. “While the investigation is ongoing, we cannot predict how foreign investors, including major semiconductor players, will view the situation.”
Nevertheless, Akmal Nasrullah stressed that his ministry remains focused on execution and reiterated the government’s commitment to developing Malaysia’s front-end chip design industry.
“This is not a short-term arrangement,” he said. “It is a 10-year effort to shift Malaysia’s semiconductor segment from back-end to front-end.”