(Yicai) Dec. 28 -- A large number of Chinese and global chip packaging and testing companies have started to move their businesses to Malaysia, given the Southeast Asian country's many advantages, including geographic position.

At least 50 chipmakers have located their bases in Malaysia, half of which are in the states of Penang and Kulim, mainly thanks to the country's location, large young population, manufacturing ability, and fast-growing economy, Yicai learned.

As a major semiconductor supply chain hub, Malaysia owns traditional advantages, an executive at a Chinese chip packaging and testing firm told Yicai. Foreign-funded chip companies started investing in Malaysia a long time ago, so their presence in the country is very strong, the executive added.

Building bases in Malaysia is mostly because of the pressure from clients, as advanced packaging and testing services always need to follow customers, an insider at a Chinese firm that is building a plant in Malaysia told Yicai.

In August, Infineon Technologies announced it would invest EUR5 billion (USD5.6 billion) to expand the capacity of its power chip plant in Malaysia. The German auto chip giant has three production lines in Malaysia for wafer production, packaging, and other purposes.

TongFu Microelectronics' USD430 million joint venture plant with US semiconductor firm Advanced Micro Devices in Malaysia is expected to be completed and come on stream by the end of the year, the Nantong, Jiangsu province-based company said in September.

Micron Technology's new packaging and testing plant in Penang was completed and put into operation, the US chipmaking giant announced in October. The plant is Micron's second of its kind in Malaysia, with a total investment of USD1 billion.

Besides Malaysia, also Singapore, Vietnam, and India are actively expanding their chip packing, testing, and manufacturing industries. Vietnam has been preparing new and upgrading old measures to attract investment projects from the semiconductor and artificial intelligence industries, Minister for Planning and Investment Nguyen Chi Dung said last month.

Editors: Liao Shumin, Futura Costaglione