Arm is set to establish a base in Malaysia after reaching an agreement with its government.

According to the prime minister Anwar Ibrahim, the agreement with the UK chip design company follows an online discussion with Masayoshi Son, CEO of Arm’s parent company, SoftBank.

“Insya-Allah, we will finalize the agreement next week, and it will be signed,” Ibrahim told reporters, according to a report from Malay Mail.

The deal forms part of Malaysia’s National Semiconductor Strategy (NSS), a three-phase $5.3 billion plan designed to boost the country’s semiconductor industry.

Currently, around 13 percent of global chip testing and packaging takes place in Malaysia but the government reportedly wants to further establish the country as a leader in semiconductor front-end design.

The three phases of the NSS involve leveraging existing capacity, pursuing cutting-edge technology, and developing local chip design and advanced packaging capabilities.

In April 2024, the Malaysian government announced plans to build the largest integrated circuit design park in Southeast Asia to promote domestic semiconductor design, prototyping, and manufacturing.

Set to be housed on a 60,000 sq ft (5,574 sqm) site in Puchong, in the state of Selangor, the government said it would offer a number of incentives, including tax breaks, office space subsidies, and visa exemption fees, to attract tech companies and investors to the facility.

The nature of Arm’s plans for Malaysia has not been made public. When contacted by DCD, the company said it would not be commenting on the announcement.