Taiwan Semiconductor Manufacturing (TSMC), the world’s largest semiconductor foundry, has plans to increase its capital allocation, exceeding the $30 billion mark for 2024.

FDI success promising in light of fresh plans, (Photo: VNA)

“TSMC’s capital allocation is closely related to its strong growth opportunities in the next few years. Of which, 70-80 per cent is invested in advanced process technology, 10-20 per cent is poured into special process technology, and about 10 per cent is put in advanced packaging technology, testing, mask production and other areas,” said Bui Van Thanh, director of New Sun Law.

“TSMC’s production capacity in 2024 is expected to double compared to the figure of 2023 and may continue to double in 2025. However, TSMC still cannot fully meet the current customer demand,” he said.

If Vietnam is selected as one of the investment destinations of TSMC, it would be a lever for more foreign direct investment (FDI).

“TSMC has not announced a specific capital allocation plan for 2025, but Vietnam still has a ray of hope to draw in investment from this group thanks to previous efforts in investment promotion activity,” Thanh added.

At the meeting in June with Richard Lawton Thurston, former senior vice president of TSMC, Minister of Planning and Investment Nguyen Chi Dung called on Thurston to support Vietnamese businesses to connect with TSMC and suggest cooperation plans between Vietnam and this dedicated semiconductor foundry.

Thurston said he would support proposals by Minister Dung, and agreed to be an advisor to Vietnam in developing plans and roadmaps for the semiconductor industry in the country.

World Bank data released on October 7 showed that investment growth has slowed in most Asian countries - with particularly sharp declines in China, Indonesia, and Malaysia, but a relatively strong increase in Vietnam.

Nguyen Van Toan, vice chairman of the Vietnam Association of Foreign-Invested Enterprises, told VIR, “Vietnam has significant opportunities to boost FDI attraction thanks to the stable growth of indices in capital so far this year, such as the increase in registered capital and disbursed capital.”

According to the Foreign Investment Agency under the Ministry of Planning and Investment (MPI), major projects in semiconductors, energy production, components, electronic products, and products with high added value have received additional investment this year.

Up to September, total registered foreign investment capital in 2024 reached more than $24.78 billion, up 11.6 per cent, and realised capital reached $17.3 billion, up 8.9 per cent over the same period in 2023.

“The basis for Vietnam to build FDI goals for 2024 is that the world’s leading business delegations, especially more semiconductor companies from the United States and partners from Japan, South Korea, and Taiwan, have been in Vietnam to explore cooperation and investment opportunities. If these proposals are realised, it will help FDI influx to bloom into next year,” Toan said.

In recent months, many technology corporations have shown interest in investing in Vietnam. At Innovate Vietnam 2024, a series of leading global technology corporations, such as Nvidia, Qualcomm, Intel, AMD, Samsung, and Meta made their presence known. At the event, the leaders of the corporations committed to investing and supporting Vietnam in developing semiconductors, AI, and innovation.

“We’ve worked with several big Chinese groups, operating high-technology, semiconductors, and supporting industries and their several satellite manufacturers, and they pay attention to the investment environment in Vietnam. We’ve also taken many delegations to work with Vietnam’s leading manufacturers such as THACO and VinFast to look for collaboration opportunities,” Toan said.

In addition, the increase in the capital influx from China into Vietnam is also a basis to retain the ability to lure more investment capital from the US and EU.

“China has overcome Japan and South Korea in terms of largest foreign investors in Vietnam. Also, one of the keys to unlocking capital from the EU is approval of the EU-Vietnam Investment Protection Agreement,” Toan added.