Vietnam is holding talks with chip companies to boost investment in the country and possibly build its first chipmaking plant, or fab, two business executives said. The Southeast Asian electronics manufacturing hub already hosts U.S. giant Intel’s (INTC.O) largest semiconductor packaging and testing plant worldwide and is home to several chip-designing software firms. It is developing a strategy to attract additional semiconductor funding, especially from foundries specializing in chip production.
During a meeting with the president of the American Semiconductor Industry Association earlier this year, Deputy Prime Minister Le Minh Khai stressed that chips are “one of the key national goods” and asked for more investments from U.S. firms. He also expressed confidence that Vietnam is well-positioned to raise the value chain in the semiconductor sector, particularly in assembling and packaging processes.
The government is pushing for higher quality and better skills among its workers, an essential requirement from significant firms that manufacture integrated circuits. Its effort includes providing more vocational training opportunities and introducing more science and technology in its curricula. These measures are expected to improve the nation’s competitiveness and make it more attractive to foreign investors.
Aside from a growing pool of skilled workers, the country has several advantages that can lure more companies into setting up plants in Vietnam. These include tax incentives, new hi-tech zones, industrial parks, low labor costs, and several free trade agreements (FTAs). The nation has concentrated its electronics manufacturing on several product types, including phones, tablets, and laptops.
But the industry is expecting more from Vietnam, with the Deputy Prime Minister recently urging the nation to seek investment in areas of the value chain that the country currently lacks, such as front-end fabrication and design. The latter requires higher levels of sophistication and higher-paying jobs, but local firms are stepping up their efforts in this area, with both FPT and state-owned Viettel expanding rapidly.
The heightened focus on the semiconductor industry is also part of a larger plan by the Vietnamese leadership to boost the country’s economic diversification and domestic market. Its dependence on imported chips makes the country vulnerable to supply chain disruptions and hidden malware risks, as demonstrated by the recent sweeping U.S. chip export ban against China.
Ji added that Amkor is committed to investing in Vietnam and helping it shape its semiconductor ecosystem. He emphasized that the company will build a state-of-the-art facility in Bac Ninh to support its global network of operations. The facility is expected to be one of the largest operated by Amkor globally. It is scheduled to be ready for trial operation in October this year. The facility will mainly produce processors for smartphones and other products. It will initially manufacture the 13th generation processor Raptor Lake and later the next generation Meteor Lake. The latter requires a more complex manufacturing process than the former, which requires high-level expertise in lithography and mask making, as well as advanced equipment.