Hana Micron Vina Co., Ltd in Bac Giang province, excels in the production and processing of integrated circuit boards for electronic products

Intel CEO Pat Gelsinger recently unveiled a cohort of Vietnamese engineers dedicated to crafting 3-nanometer chips—a groundbreaking 3nm Multidie chip technology acclaimed as a technological marvel, representing the pinnacle of advanced chip design solutions globally.

Adding to this, Vietnam has successfully pioneered the creation of its inaugural 5G chip line. The Viettel Group recently disclosed the inception of the 5G DFE chip—a component renowned for its complexity within the 5G ecosystem, boasting a computing capacity of 1,000 billion operations per second.

The mastery of chip design marks a pivotal stride for Vietnam, propelling it into deeper engagement within the global semiconductor arena. This strategic move unfolds within a context where the worldwide market is yet to present commercial 5G chip products. This positions Vietnam to not only manufacture chips for prevailing technologies like AI (artificial intelligence) but also for the forthcoming realms of 6G and IoT (internet of things).

While several countries in the region, including Thailand, the Philippines, and Cambodia, exhibit keen interest in the semiconductor industry—a sector hailed as the hottest globally—Vietnam holds a distinctive advantage. Bolstered by substantial support from leading global corporations, Vietnam stands out. Jimmy Goodrich, Vice President of the American Semiconductor Industry Association (SIA), asserted that Vietnam enjoys an advantage, having secured billions of US dollars in investments from foreign corporations.  Prominent industry giants like Intel and Samsung, ranking among the top three chipmakers globally, have established and are expanding chip production facilities within Vietnam. This positioning amplifies Vietnam's prominence and potential within the semiconductor domain.

Robust analysis underscores the pivotal role of a stable political institution as a prerequisite for foreign investors contemplating factory investments in a country. Vietnam not only possesses these essential factors but also aligns with the crucial conditions anticipated by investors. Demonstrating resilience, Vietnam has proven itself a secure and conducive business environment for semiconductor investors.

In 2022, Vietnam emerged as a significant player, constituting over 10% of U.S. chip imports for an uninterrupted seven-month period. Vietnam became the third-highest in Asia for sales, trailing behind Malaysia and Taiwan, in semiconductor exports to the U.S., as indicated by the Ministry of Information and Communications in May of the same year.

Enshrined in the Joint Declaration on Vietnam-U.S. Comprehensive Strategic Partnership, both nations acknowledged Vietnam's immense potential to emerge as a key player in the semiconductor industry. This recognition is underscored by the unwavering support from U.S. President Joe Biden, advocating for the development of Vietnam's semiconductor ecosystem. The U.S. has committed to actively collaborate to enhance Vietnam's standing in the global semiconductor supply chain. A significant stride in this direction involves the initiation of human resource development initiatives, bolstered by an initial seeding grant of US$2 million from the U.S. Government, complemented by future support from the Vietnamese government and private sector.

Intel, standing tall as one of the world's top three chipmakers, embodies its confidence in Vietnam's potential. Having invested US$1 billion in chip manufacturing more than a decade ago, Intel further bolstered this commitment in 2021 by increasing its investment fund in the project to nearly US$1.5 billion.

Arizona-based Amkor Technology initiated operations at its state-of-the-art US$1.6-billion facility in Bac Ninh province in October 2023. Simultaneously, California-based Synopsys Corporation is actively engaged in a semiconductor design and incubation center in collaboration with Saigon High-Tech Park. Meanwhile, California-based Marvell is poised to declare the establishment of a world-class semiconductor design center in Ho Chi Minh City.

Samsung, a tech giant, is undergoing chip grid array testing and is poised to commence mass production at its Thai Nguyen factory. This marks a significant stride as semiconductors become Samsung's third business segment in Vietnam, complementing its existing production of home appliances and nearly half of its smartphones.

Concurrently, Vietnamese enterprises are intensifying their involvement in the chip industry to solidify their standing on the global chip map. Companies like FPT Semiconductor, CMC, and Viettel are spearheading this trajectory, enabling Vietnam to break free from the middle-income trap, embrace cutting-edge technology, and emerge as a producer of Vietnamese-branded chips.

Highlighting the competitive edge of Vietnamese chips, Mr. Nguyen Vinh Quang, Director of FPT Semiconductor, emphasizes their advantageous pricing. He noted that Vietnam excels in crafting performance chips that achieve nearly 100% of the major brands' capabilities at prices equivalent to only 50-60% of comparable products.

FPT Corporation currently sees orders for 70 million chips from South Korea, Japan, and Taiwan. As the global semiconductor supply chain shifts toward new markets, Vietnam is poised to produce millions of chips.

The human capital aspect is pivotal for Vietnam's mastery of semiconductor technology. Presently, there are approximately 5,500 chip design engineers in Vietnam, primarily concentrated in Ho Chi Minh City (85%), Hanoi (8%), and Da Nang (7%). The Ho Chi Minh City Electronics and Semiconductor Center (ESC) aims to train over 50,000 semiconductor design engineers by 2030. This initiative presents a unique opportunity for Vietnamese workers to enhance their skills, pursue further studies, and significantly elevate their incomes, given the lucrative nature of this industry.

Minister of Planning and Investment Nguyen Chi Dung, speaking at the recent Vietnam Business Summit, underscored the nation's capability to foster semiconductor industry development. Anchored by a stable political system, advantageous geographical location, abundant labor resources, and collaboration-ready corporate giants, Vietnam is attracting significant interest from large semiconductor corporations globally. Additionally, the establishment of the National Innovation Center (NIC) and three high-tech parks in Ho Chi Minh City, Hoa Lac, and Da Nang, coupled with incentives for semiconductor investors, positions Vietnam strategically. The country is also formulating a draft Semiconductor Industry Development Strategy up to 2030, with a visionary outlook to 2035.