Malaysia Downplays Huawei Chips Project Amid US-China AI Rivalry

KL says venture driven by private sector, not officially endorsed by government

- Hazlin Hassan

KUALA LUMPUR - Malaysia has abruptly distanced itself from an earlier announcement of a China-backed artificial intelligence (AI) project, amid heightened scrutiny over geopolitical sensitivities and ongoing trade talks with the United States.

The reversal exposes Malaysia's precarious balancing act as it navigates fierce US-China rivalry over semiconductors - a sector accounting for 40 per cent of its exports.

Prime Minister Anwar Ibrahim called the announcement on the AI project by a junior minister on May 19 "premature", and insisted that Malaysia remains "fiercely independent" in choosing technologies.

"To clarify, (the project is) still in the midst of this negotiation. Because it is the private sector, I don't think it's for the government to announce, but as a policy we made it very clear. We are fiercely independent. We want what is best for our country," he told a media briefing on May 21.

He added: "For a country like Malaysia, I'm not taking into account the skirmishes and the tensions between countries, particularly China or the EU or the US. We choose what is best for our country."

Deputy Communications Minister Teo Nie Ching announced on May 19 that Malaysia would develop a first-of-its-kind AI system powered by Huawei Technologies chips, with plans to deploy 3,000 Huawei Ascend chips as the backbone of a national AI initiative by 2026.