Expert: “Vietnam can turn the ‘chip fever’ into a methodical race, ensuring the leading position in the semiconductor revolution”

However, to be able to develop in the long term, Dr. Nguyen Khac Giang said that Vietnam needs to strengthen support for domestic semiconductor companies so that it can gradually turn the country into an important area in the global chip market.

According to Dr. Nguyen Khac Giang, Vietnam is accelerating in semiconductor development. Accordingly, recent statistics from the Ministry of Information and Communications (MIC) show that Vietnam is rising to become the third largest chip exporter to the United States, after Malaysia and Taiwan (China). .

Notably, the sales of this item in February 2023 increased by 75% over the same period last year, reaching 562 million USD.

In a word, the export turnover of all electronic products of Vietnam to the United States (including semiconductors) in February 2013 was only 110 million USD.

“The increase in semiconductor exports is a testament to Vietnam’s position in the US-China trade war. Companies trapped in the spiral of the semiconductor supply chain have chosen Vietnam to diversify. diversify the chip supply,” said ISEAS Institute expert Yusof Ishak.

Since 2012, the Government of Vietnam has considered semiconductor products as “the nation’s key goods and services”. Dr. Nguyen Khac Giang assessed: “As the $600 billion industry becomes the mainstay of the global economy, underpinning all electronic products, from smartphones to computers, by choosing By developing the semiconductor industry, Vietnam can improve its position in the global value chain, transform from a cheap labor model to a modernized economic model. GDP per capita consumption will reach over 18,000 USD by 2045.

However, Mr. Giang said that in order for these benefits to become a long-term growth engine, Vietnam must readjust its policy framework, increase vocational training for high-tech industries and strengthen support for domestic businesses.

Vietnam mainly focuses on attracting big players in the semiconductor field to invest in the country. Accordingly, Intel is the first large corporation to produce chips in Vietnam, with a base located in Ho Chi Minh City. As of 2021, the facility supplies 3 billion semiconductor products worldwide. After Intel, other large global companies, including Samsung, Qualcomm, Texas Instruments, SK Hynix, Hayward Quartz Technology, Synopsys and NXP Semiconductors have also invested in Vietnam.

In the late 2010s, domestic companies, including Viettel and FPT, also began to enter the semiconductor industry, which is estimated to be worth $6.16 billion by 2024.

However, Mr. Giang assessed, Vietnam’s semiconductor industry is highly dependent on foreign direct investment (FDI) and most of Vietnam’s chip exports come from FDI companies. Specifically, 98% of the export turnover of electronic products comes from the FDI sector.

Accordingly, Vietnam’s role in the supply chain is mainly limited to assembly, testing and packaging, without any domestically produced semiconductors. Even the first “Made in Vietnam” chips of FPT Semiconductor were made in Korea.

According to Dr. Nguyen Khac Giang, Vietnam is promoting and nurturing leading domestic enterprises in this field with plans to produce domestic chips in the future. However, Mr. Giang said, while the number of domestic technology enterprises in Vietnam is increasing, most are small and medium enterprises. Apart from Viettel and FPT, few companies are equipped to climb the ladder of the semiconductor industry. As of 2021, 99% of hardware components in the IT industry are imported.

Besides, although there is an abundant source of technology talent, especially in the field of software development and IT services, the training process in technology-related fields of Vietnam is still difficult. relatively slow.

In addition, Vietnam still does not have a comprehensive national strategy for the semiconductor business. Dr. Nguyen Khac Giang said, without clear technology transfer incentives or policy support, it will be difficult for domestic enterprises to participate in the semiconductor supply chain with global companies.

Although there are still many challenges, ISEAS Institute expert – Yusof Ishak said, the future of Vietnam’s semiconductor industry is still promising. Accordingly, at the end of 2022, Samsung inaugurated a $220 million R&D center in Hanoi and announced plans to mass produce chips in Vietnam from mid-2023. Not only that, Amkor Technology, a leading company The world leader in outsourcing semiconductor packaging and testing services, will also open a factory in Vietnam later this year.

Dr. Nguyen Khac Giang assessed: “In the context of US-China trade, the global economy is becoming more and more dependent on semiconductors, Vietnam’s continued focus on this field can reap significant benefits. However, the transition from a beneficiary to a player in the global semiconductor market requires major policy changes.By strengthening education and training systems, fostering foster domestic innovation and develop a clear national strategy”.

“Vietnam can turn the “chip fever” into a well-built marathon, ensuring its leading position in the semiconductor revolution,” the expert emphasized.

Source: Fulcum