Malaysia adopts the Transitioning Industrial Clusters framework – here's what that means

A global industrial transformation is underway. Rising energy demand, shifting geopolitics and new technologies are reshaping industrial ecosystems. Energy security and industrial competitiveness now go hand in hand, yet investment in clean energy remains far below what is needed. Establishing competitive industrial clusters is essential to bridge this gap.

Launched at the 2021 United Nations Climate Change Conference (COP26) by the World Economic Forum, in collaboration with Accenture and EPRI, the Transitioning Industrial Clusters initiative has grown to 40 industrial clusters across 20 countries, to become the largest community of its kind globally.

Well-organized industrial clusters – geographic areas where co-located companies and public institutions collaborate – present an immediate opportunity for transformative action. By sharing infrastructure, resources and risks, industrial clusters can achieve greater efficiency and collective impact.

But despite their potential, many clusters face challenges, including unclear growth strategies, fragmented governance structures and limited focus on shared business cases.
To accelerate industrial transformation through a holistic approach, the initiative has developed the TIC framework, built on four foundational components.

In June 2025, Malaysia adopted the TIC framework as a national agenda to drive green economic growth, open up highly skilled job opportunities and reduce carbon emissions.

Prime Minister Anwar bin Ibrahim said: "The Malaysian Government agreed to adopt TIC as national agenda as it is a strategic move that unites companies and public institutions to drive green economic growth, open up highly skilled job opportunities and reduce carbon emissions."

This milestone, achieved in collaboration with the Malaysia Centre for the Fourth Industrial Revolution (MYCentre4IR), reflects over a year and a half of sustained engagement in the country, including virtual and in-person events across key industrial hubs such as Johor and Sarawak to build a shared vision.

It affirms the Forum’s ability to foster national and regional public-private collaboration and shape cutting-edge thinking on industrial cluster development.

With this national endorsement, MYCentre4IR has been mandated by the prime minister to coordinate federal and state agencies and develop a unified proposal to accelerate Malaysia’s industrial cluster transitions.

Key priorities will include:

Malaysia’s key industrial hubs each play a distinct role in advancing the nation’s sustainable, technology-driven growth agenda.

Anchored in the state of Sarawak, the Bintulu cluster leverages abundant renewable resources and a mature petrochemical ecosystem to position Malaysia as a leader in green molecules production. The cluster focuses on:

Johor is rapidly becoming one of Southeast Asia’s core digital and hyperscale clusters. The TIC strategy focuses on:

Selangor’s broad manufacturing base offers significant potential for long-term ecosystem strengthening. Early TIC work focuses on:

Penang’s semiconductor and E&E ecosystem continues to evolve as part of a growing regional corridor. TIC discussions centre on strengthening overall ecosystem readiness and exploring pathways for sustained, high-value industrial growth.

This strategy will enhance Malaysia’s industrial competitiveness, deepen participation in regional value chains, and position the country as a leading hub for sustainable and technology-driven industrial development in Southeast Asia.

The TIC initiative convenes the world’s leading public and private industrial stakeholders at various stages of ambition and development to align on the components required to competitively apply for funding, secure regulatory support and launch full-scale development activities to transition industrial clusters successfully.

The initiative delivers tangible outcomes across three levels of impact – policy, cluster and project – demonstrating how collaborative action can translate strategic dialogue into national adoption, industrial transformation and on-the-ground implementation.

Each level reinforces the others, creating a scalable model that can be replicated across countries, regions and industry clusters to strengthen competitiveness.

Therefore, TIC enables Malaysia to respond effectively to shifting global market forces. By strategically adopting high-impact technologies, industrial clusters can transform into engines of green growth and drivers of global competitiveness.