What makes Penang an industrial success story?
   AMD was one of the pioneer multinationals to set foot on the island more than 30 years ago. One key factor, says Sofi, was the ease of communication due to the widespread use of English in business. In addition, Sofi says, "There were talented people and the government was politically stable and business- friendly. Since then, AMD's satisfaction has rung up more than US$1 billion in capital investment."
   One factor that scores high with transnational companies is Penang's culture of quality business practices and ethical values that has become engrained in its work force over the years. "Penang has provided a good support infrastructure for our business," says Libby. "The government is pro- business and stable, and we have good power, water and telecom.
   "Plus, in our type of business, we need a good supply base, a good support structure from hard- working employees with good ethics to contract workers and to vendors to supply the parts we require. The area already had this base of knowledge," Libby says, before the company began operations in Penang 12 years ago. Linear's location decision was based entirely on previous, positive experiences in Penang formed by Linear senior managers earlier in their careers.
   Libby says the semiconductor- maker did not consider other sites in Southeast Asia for an expansion in 2000 and another one breaking ground this year. "The idea of going to some other location and starting from scratch did not cross our mind, with all the headaches in an area without the infrastructure that Penang offers. This area provides all we need."
   Philips Lumileds, manufacturer and packager of LEDs, also is content to expand in Penang. Lumileds is the outgrowth of a JV in Penang between Philips and Agilent Technologies. Lumileds spokesman Steve Landau explains that Lumileds's plant was designed with expansion in mind.
   Traffic congestion is a common drag on business around the world, including Penang. Industrial leaders cite the lack of good public transportation as one negative. A second bridge to the mainland is in the works to help alleviate traffic delays.
   One little- known fact about Penang is that local staff are used for management teams to launch operations in China, India and other countries in Southeast Asia. Dell Computers, which has been in Penang since 1995, sent a local team to start up its China facility. "Penang is the mother ship," says managing director Wong. Another local team will set up and lead Dell's India facility next year.