How Vietnam Aiming to Build its First Semiconductor Fab In The Country

Published  November 2, 2023   0
S Staff
Chip-Fabrication Unit

The country is forming new strategies to magnetize dozens of semiconductor investments mostly in foundries that focus on semiconductor manufacturing

In an effort to grow the semiconductor manufacturing ecosystem and increase investments for the same, the Southeast Asian country Vietnam is holding discussions with international chip firms. The country is now looking forward to set-up its first semiconductor production facility or fab, confirmed by two unnamed business executives.

Media reports also added that some US industry executives have expressed stern warnings in regards to high costs. For over a decade, Vietnam has been a global hub for electronics manufacturing and has Intel’s largest semiconductor packaging and testing facility and has a range of chip designing software companies. Now, the country is forming new strategies to magnetize dozens of semiconductor investments mostly in foundries that focus on semiconductor manufacturing.

In the past few weeks, several rounds of discussions took place with a couple of US based chipset companies according to Vu Tu Thanh, head of the Vietnam office of the US-ASEAN Business Council. When Reuters approached for further information, he did not agree to disclose the name of the companies in the initial stage. An unnamed chip executive told Reuters discussions took place with GlobalFoundries and Taiwan’s PSMC.

The unnamed chip executive also said that Vietnam is likely to set-up its first fab soon mostly for less top-notch chips, which are utilized in telecom applications and vehicles. There was an amicable agreement formed between the US and Vietnam back in September when President Biden visited Hanoi and the US officials described Vietnam as a key destination in semiconductor international supply chains. 

When the media reached GlobalFoundries for investment status, the spokesperson said that they do not believe in market rumors. Industry executives said that the initial meetings is to see the interest and talk about probable incentives and subsidies, including on infrastructures, power supply, and the availability of skilled workforces. Nonetheless,  Robert Li, Vice President of U.S. Synopsys, a chip design company, requested the Vietnamese government to think accurately before providing subsidies to set-up fabs. 

At the Vietnam Semiconductor Summit, Li added that construction of a new fab could cost around $50 billion, and might have to compete on subsidies with China, the US, South Korea, and the EU, which have announced major investments on chips between $50 and $150 billion each.