44 Management Discussion And Analysis / Business Review DAGANG NeXCHANGE BERHAD Integrated Report 2024 BUSINESS REVIEW Supply Chain and Geopolitical Disruption Risk Description Ongoing geopolitical tensions and global supply chain volatility, particularly around semiconductor materials and equipment, could impact operations and lead times. In particular, export controls and potential new semiconductor tariffs from the United States may disrupt SilTerra’s supply chain or affect customer demand, especially given Malaysia’s strategic role in the global semiconductor ecosystem and SilTerra’s shareholder profile. Following the conclusion of the 2024 United States presidential election, trade policy direction remains uncertain, introducing potential changes that could further affect global technology flows. Mitigation We maintain a diversified supplier base and work closely with partners to ensure inventory resilience and sourcing flexibility. We are also proactively expanding our customer portfolio and strengthening international collaborations, including with partners such as IMEC and IIT Madras, to mitigate geopolitical concentration risk and preserve market access. Legal Uncertainty Risk Description An ongoing legal arbitration involving shareholders has the potential to impact operations, decision-making or investor confidence. Mitigation We are actively managing this process with oversight from our Board and legal advisors, and we remain committed to transparency and continuity in operations regardless of the outcome. Talent Shortages in Specialised Fields Risk Description Malaysia’s semiconductor talent pool in areas such as Silicon Photonics and advanced R&D remains limited, which may constrain our ability to scale and innovate quickly. Mitigation The Technology Business Segment is investing in building internal capabilities, particularly in Silicon Photonics, advanced R&D and other emerging technologies, by upskilling its existing workforce. At the same time, we are forging stronger collaborations with academic institutions to bridge the talent gap and create a steady pipeline of skilled professionals. We are also actively fostering a workplace culture that promotes continuous learning, innovation and employee retention by offering professional development programmes, competitive incentives and a supportive work environment.
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