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The government of Vietnam has approved an investment of 500 million dollars for the construction of its first chip manufacturing plant, as part of a national strategy to develop the semiconductor industry and reduce its dependence on global supply chains.
This project is part of the Semiconductor Development Strategy 2030, Vision 2050, recently approved by the Vietnamese government, with the aim of making the country a key player in the global chip industry.
A strategic step toward technological independence
The new chip manufacturing plant will focus on the production of small-scale and high-tech semiconductors for strategic sectors such as national security, artificial intelligence, and advanced electronics.
“Semiconductor technology is the future,” said Nguyen Trung Kien, deputy director of the semiconductor technology division at Viettel. “This initiative will enable Vietnam to compete globally in chip design and manufacturing.”
The government has designed a financial incentive package to attract private investment and accelerate the growth of the sector, including:
- 30% subsidies of the project cost for factories that are completed before December 31, 2030.
- Tax benefits, allowing sector companies to retain up to 20% of their taxable income for reinvestment.
- Direct land allocation for semiconductor factories, without the need for public auctions, to expedite the construction of facilities.
The Prime Minister of Vietnam will personally oversee the selection of private companies that will collaborate on the project, ensuring the integration of public and private investment.
Vietnam as a new semiconductor hub in Asia
Vietnam is emerging as an attractive destination for the semiconductor industry, driven by trade tensions between the United States and China and the growing need to diversify global supply chains.
Vietnamese tech companies such as Viettel and FPT have already begun developing advanced chips. Viettel, for instance, has designed the 5G DFE chip, the most complex in Southeast Asia, capable of processing one trillion calculations per second.
“This is a unique opportunity for Vietnam to become a semiconductor powerhouse,” emphasized Le Quang Dam, CEO of Marvell Technology Vietnam.
Additionally, countries like the United States, South Korea, and Japan have shown interest in strengthening their partnerships with Vietnam in the semiconductor sector, which could attract foreign investment and accelerate the growth of this industry in the country.
Challenges and opportunities for Vietnam in the semiconductor industry
Despite the optimism, the country faces significant challenges in its attempt to establish itself as a leader in semiconductors, including:
- Shortage of specialized engineers in chip design and manufacturing.
- High initial costs for building and operating semiconductor plants.
- Fierce global competition from countries like Taiwan, South Korea, and the United States, which dominate the market.
However, with government support, private investment, and a growing tech talent pool, Vietnam could become a key player in the chip industry in the coming decades, reinforcing its position in the global supply chain and advancing toward technological independence by 2050.
Source: vietnamnet