Localities look into microchip gains, Image generated by AI

Ho Chi Minh City is among the regions of Vietnam proposing new incentive mechanisms to address barriers hindering development of the semiconductor industry.

The city has identified the semiconductor industry as a strategic area, according to Tran Dieu Thuy, Vice Chairwoman of Ho Chi Minh City People’s Committee.

“We propose that the government submit amendments to Resolution No.98/2023/QH15, including a mechanism to exempt personal income tax for 10 years for both domestic and foreign experts working in Ho Chi Minh City in the semiconductor field,” Thuy said at the second meeting of the National Steering Committee on the issue, held in Hanoi on August 4.

For chip manufacturing and large-scale data centre projects, Ho Chi Minh City proposes including them in the list of strategic investment priorities, accompanied by a green channel mechanism to streamline administrative procedures to the maximum, creating a competitive advantage to attract leading global technology giants.

“Regarding infrastructure, the city proposes that the government prioritise accelerating the approval of plans to expand the high-tech park and establish a digital technology industrial park (IP) to create clean land reserves ready to accommodate large-scale projects,” Thuy added.

The city also recommends that the government introduce specific preferential credit mechanisms for domestic enterprises investing in chip design, semiconductor material production, and supporting industries.

Currently, Ho Chi Minh City has wooed major technology corporations like Intel, Samsung, Marvell, Renesas, Siemens, Ampere Computing, and others to invest. At the Saigon High-Tech Park alone, 37 electronics and microchip projects are operational, worth over $7.7 billion.

In addition to Ho Chi Minh City, Bac Ninh province in the north is planning to establish a provincial semiconductor development steering committee, modelled after the national equivalent.

Bac Ninh People’s Committee has issued plans to transform the province into a leading semiconductor industry hub in the north, and eventually nationwide, by 2030, with a vision to become a regional leader by 2045. By that point, the province aims to become a leading regional centre for microchip and semiconductor production, establish chip manufacturing plants, master certain core technologies, expand participation in the global semiconductor supply chain, and export Vietnamese-made semiconductor products.

Bac Ninh is currently a hub for major tech corporations such as Samsung, Canon, Amkor Technology, Foxconn, Goertek, and strategic partners of Nvidia. These enterprises have contributed to building a large-scale, modern high-tech industrial ecosystem in Northern Vietnam.

Additionally, Dong Nai and Hanoi are also developing strategies for semiconductor ecosystems. Park Iae Cheol, project manager of Segyung Vina Co., Ltd., said, “We highly appreciate the high-tech industrial ecosystem in the locality, where the local supply chain is very stable. Bac Ninh possesses all the necessary factors for the semiconductor industry to thrive, such as electricity, clean water, logistics, and especially the training of high-quality human resources. That’s why we decided to build an additional factory in the province.”

Segyung Vina Co., Ltd. was established in 2023, headquartered in Que Vo IP of Bac Ninh. This company’s main business is the production of plastic products. Specifically, it produces tapes, films, and foams that are used for lining, cushioning, insulation, waterproofing, shock absorption, screen protection, and other accessories for cars, mobile phones, and electronic devices.

Meanwhile, US-based semiconductor materials and components giant Coherent Corporation inaugurated its $127 million plant at Nhon Trach IP in Dong Nai province on July 28. The facility marks a key investment in the region and will produce precision-engineered materials and photonics components used in a wide range of applications, from smartphones and electric vehicles to advanced medical devices.

Speaking at the opening ceremony, Deputy Prime Minister Nguyen Chi Dung hailed the opening as a pivotal step in Coherent’s global tech development strategy. He also underscored the move as compelling evidence of the growing confidence that leading global tech firms are placing in Vietnam’s investment environment and development potential.

Gan YC, director of Nhon Trach 1 Factory, said the new facility is designed with scalability and flexibility at its core. “It plays a pivotal role in enhancing our capabilities in silicon carbide and optics, both essential to the transformation of industrial systems, high-speed communications, and data centre infrastructure,” he said. “Equipped with smart manufacturing systems and a high-quality local workforce, the factory strengthens our supply chain, reduces lead times, and brings us closer to key markets across Asia.”