Investments in semiconductor manufacturing Vietnam plans to position itself as a global semiconductor workforce center

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In late September 2024, the Vietnamese government released a three-phase plan to position itself as a global semiconductor workforce center by 2050. The goal is to establish several hundred design companies, multiple semiconductor productions, and numerous packaging and testing capacities.

According to reports, the Vietnamese government intends to use the next 25 years to become a significant player in the global semiconductor ecosystem through a three-phase plan. For this purpose, Prime Minister Pham Minh Chinh signed a letter of intent on September 21, 2024, that further outlines the plan. The strategy "C = SET + 1" stands for Chip (C), Specialization (S), Electronics (E), Talent (T), and +1 for Vietnam. The country aims to become a new and secure destination for the global semiconductor supply chain.

As mentioned, three phases are planned for this, which the government has formulated as follows. Starting this year and until 2030, Vietnam wants to use its relatively secure geopolitical position to attract foreign investors, establish itself as a global semiconductor workforce center, and significantly increase capacities in research, design, manufacturing, and packaging as well as testing.

"The country will selectively attract foreign direct investments, establish at least 100 development companies, a small production factory, and 10 packaging and testing facilities, and develop some specialized semiconductor products for various sectors," details the plan. It is expected that the domestic semiconductor industry will achieve an annual turnover of more than 25 billion US dollars and a value-added growth of 10 to 15 percent. The electronics industry is targeting an annual turnover of over 225 billion US dollars and a similar rate of value-added growth. This is not the limit. By 2030, the plan expects more than 50,000 engineers and university graduates to be working in the semiconductor industry in Vietnam.

Phase 2 and Phase 3: The milestones up to 2040 and 2050

By 2040, at least 200 design companies, two manufacturing plants, and 15 packaging and testing sites are expected to have been established; by 2050, according to the Vietnamese government's plans, there would be at least 300 design companies, three production facilities, and 20 packaging and testing facilities established.

"Vietnam is determined to occupy a leading global position in the semiconductor and electronics industries and to master research and development (R&D) in these areas," the government communicates. To achieve these ambitious goals, the focus will be on several defined pillars; these include the development of dedicated chips, the electronics industry, and the workforce, the recruitment of talent for the semiconductor sector, foreign direct investments for the sector, and the establishment of a national steering committee for the development of the semiconductor industry.

So far, many companies have not specifically considered Vietnam for chip manufacturing, but numerous electronics manufacturing companies, such as Samsung, Texas Instruments, NXP, Qualcomm, and Onsemi, do operate there. Intel runs a significant testing and assembly facility near Ho Chi Minh City. According to the Vietnamese government, many more companies should follow this example in the coming years. (sb)

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