Singapore and Malaysia have natural strategic advantages from their locations as gateways to Asia. They have used their location to become major financial centers, and they provide tax incentives to encourage the transfer and development of technological and intellectual property. Both governments are committed to high levels of GNP growth. They recognize that technology and product development are required to move beyond their strength in manufacturing. The governments actively follow and track the technology roadmaps developed in advanced nations that conduct cutting-edge research and development, and they quickly develop complementary approaches to attract local participation. Commonly shared visions by government officials facilitate their ability to make quick decisions, a key factor in their success.
The primary goals of Singapore and Malaysia are to become totally self-sufficient and self-sustaining economies while maintaining high standards of living. In terms of electronics technologies, they have acquired and are importing the additional technologies and intellectual property required to achieve independence from foreign sources. Their strengths include the following:
In some cases, the governments have provided nearly 100% financing and investment to multinationals that could enhance technology transfer. Multinationals are transferring state-of-the-art development and manufacturing to take advantage of the financial incentives offered by Singapore and Malaysia. In addition, the governments are subsidizing R&D activities for advanced technologies. As a result, the old model of technology movement from the United States and Japan into Singapore and Malaysia is changing.
As shown in Table 4.6, as Singapore and Malaysia move towards increased research, with high-volume, low-cost manufacturers, the United States is most likely to become a technology follower. They are moving rapidly into design and development and are increasing their investments in research in all areas of electronics. They are well established in production of ICs, IC packaging, PCB fabrication, and PCB assembly. The Singapore and Malaysia PCBA industry is on par with (or slightly behind) the United States in terms of technology. Both countries have increasing design capabilities in all of these areas and are moving into basic materials research to support next-generation component developments.Table 4.6
The work ethic and regional loyalty in Singapore and Malaysia are high due to such labor benefits as the governments' effective health care and retirement programs. A strong desire for personal advancement, stimulated by a high demand for talent, results in a great deal of job hopping and thus "technology transfer" throughout the region. The governments attract high-value-added capabilities by being able to establish new expertise. Government institutes focus on training future engineers, presenting a shared vision of technology directions, and providing centralized facilities for use by local companies. While the research of these organizations is insignificant, their product deployment capabilities are well utilized. Deployment of leading technologies for mass production (bare chip attachment, BGA, etc.) is ongoing.
The United States is clearly more advanced than Singapore and Malaysia in conducting both basic and applied research; is slightly ahead of Singapore and Malaysia in terms of process development; is on par with Singapore and Malaysia in terms of process deployment; and is behind Singapore and Malaysia in continuous improvement of mass production. But in the minds of officials in Singapore and Malaysia, it will not be long before their countries are on par with or ahead of the United States as they rapidly move into design and development and eventually into basic research with a number of consortia. Government and industry work closely together to keep up the rapid growth rate. There is a strong emphasis on technological innovation and development of core competencies. These two countries plan to be long-term leaders as they continuously seek the next application for high-volume production in order to gain economies of scale. Based on their vision and strengths, Singapore and Malaysia will remain world leaders in the area of electronics.