Vietnam arming up to serve in US chip war on China

[Viet]

Samsung's plant in Thai Nguyen Province, northern Vietnam. Photo: Samsung

The CEO of Samsung Electronics met with Vietnamese Prime Minister Pham Minh Chinh and announced a US$850 million investment to manufacture semiconductor components in Thai Nguyen province on August 5, 2022.

The investment will make Vietnam one of only four countries – alongside South Korea, China and the United States – that produce semiconductors for the world’s largest memory chipmaker. Vietnam’s selection over more developed locations speaks volumes about the country’s rising importance in the semiconductor value chain.

Vietnam is not a newcomer to the semiconductor industry. The country’s first semiconductor plant, Z181, was established in 1979 to produce and export semiconductor components to the Eastern Bloc during the Cold War.

The collapse of the Soviet Union and the ensuing trade embargo put an end to the country’s first attempt at developing semiconductor capability. Yet the desire to enter the global semiconductor value chain lives on. For Vietnamese leaders, semiconductors represent both economic opportunities and national security interests.

Entry into the semiconductor value chain means tapping into a global market forecasted to reach US$1.4 trillion by 2029 with a 12% compounded annual growth rate. It also strengthens local skills and expertise, fosters the development of associated high-tech industries and raises the domestic value-added in electronics production.

Semiconductors are also a matter of national security. Dependence on imported chips makes the country’s critical infrastructure vulnerable to supply chain disruptions and hidden malware risks. The sweeping US chip export ban on China raises concerns in Vietnam as to whether its political differences from the West may lead to a similar fate in the future.

Hanoi has adopted a two-pronged strategy to reduce its vulnerability to these external threats. It maintains diplomatic neutrality amid geopolitical conflicts while gradually strengthening domestic capability in all three stages of the semiconductor value chain — chip design, front-end fabrication and back-end assembly and testing.

Vietnam’s industrial and technology policies have always granted the highest incentives for high-tech projects, including corporate income tax reduction and sales tax and land rent exemption.

Workers at an electronics factory in Vietnam. Photo: Facebook

In 2020, as tech firms continued to exit China, Vietnam established a special working group to court high-tech investments by offering customized incentives beyond those specified by existing laws. Different Vietnamese prime ministers have met with executives of global tech giants to encourage investment in semiconductors.

Generous incentives are not the only reason multinationals are pouring billions of dollars into Vietnam’s semiconductor ecosystem. One advantage of Vietnam over its regional neighbors is its pool of young engineering talent at a relatively lower cost.

Over 40% of Vietnamese college and university graduates are majoring in science and engineering, and Vietnam has been among the top 10 countries with the most engineering graduates.

As the risks of putting all one’s eggs in the China basket increase, semiconductor companies find Vietnam a promising option for their “China Plus One” strategy. The country’s northern manufacturing cluster is only a 12-hour drive away from Shenzhen, China’s manufacturing hub. That ensures minimal supply chain disruptions for those looking to diversify.

Vietnam also boasts one of the most open economies in the world, with 15 free trade agreements, an ever-improving business environment and a relatively stable government with clear socio-economic development plans. The country’s geopolitical neutrality is another plus for tech companies searching for a low-risk location to produce and export.

Vietnam’s semiconductor scene is evolving quickly across all stages of the value chain. Synopsys — a leader in chip design software — is shifting its investment and engineering training from China to Vietnam. The South Korean tech giant, Amkor Technology, signed a deal in 2021 to establish a $1.6 billion semiconductor manufacturing plant in Bac Ninh province.

Intel recently channeled an additional $475 million into its assembly and test plant in Vietnam that produces core processors. Local tech corporations have similarly launched their own lines of low-end semiconductors for a wide range of applications. Such projects are laying the foundation for even more investments to come.

The next step for Vietnam is to go beyond attracting foreign direct investment to integrating multinationals into its economy. Weaknesses in the country’s investment climate — including backward infrastructure, weak intellectual property rights enforcement, cumbersome procedures, underdeveloped supplier networks and a shortage of local skills — must be addressed urgently.

Vietnam should leverage foreign investors’ resources and expertise to catalyze improvements in its semiconductor ecosystem. The recent chip design training agreement between Synopsys and Saigon Hi-Tech Park is a welcome step in this direction.

Vietnam is cranking out engineering graduates to serve its burgeoning semiconductor industry. Image: Facebook

Another example is Samsung’s domestic supplier development program — jointly organized with the Ministry of Industry and Trade — enabling many domestic suppliers to become internationally competitive.

What Vietnam should not do is try picking winners to gain sovereign capability in semiconductors. Protecting local — especially state-owned — enterprises from foreign competition while subsidizing their operations only perpetuates the inefficient use of domestic resources.

The policy should focus on creating a business environment that enables all potential winners, foreign and local, to thrive.

Vietnam arming up to serve in US chip war on China - Asia Times

The CEO of Samsung Electronics met with Vietnamese Prime Minister Pham Minh Chinh and announced a US$850 million investment to manufacture semiconductor

asiatimes.com

 

[AViet]

This is the first time I've ever heard that Vietnam exported semiconductor materials to the communist bloc back in 1979, although i have mentioned once on this forum that Vietnam tried to manufacture transistors long long time ago.

A little bit surprised, as Vietnam was extremely poor in 1970 and 1980 decades

 

[Beast]

Samsung's plant in Thai Nguyen Province, northern Vietnam. Photo: Samsung

The CEO of Samsung Electronics met with Vietnamese Prime Minister Pham Minh Chinh and announced a US$850 million investment to manufacture semiconductor components in Thai Nguyen province on August 5, 2022.

The investment will make Vietnam one of only four countries – alongside South Korea, China and the United States – that produce semiconductors for the world’s largest memory chipmaker. Vietnam’s selection over more developed locations speaks volumes about the country’s rising importance in the semiconductor value chain.

Vietnam is not a newcomer to the semiconductor industry. The country’s first semiconductor plant, Z181, was established in 1979 to produce and export semiconductor components to the Eastern Bloc during the Cold War.

The collapse of the Soviet Union and the ensuing trade embargo put an end to the country’s first attempt at developing semiconductor capability. Yet the desire to enter the global semiconductor value chain lives on. For Vietnamese leaders, semiconductors represent both economic opportunities and national security interests.

Entry into the semiconductor value chain means tapping into a global market forecasted to reach US$1.4 trillion by 2029 with a 12% compounded annual growth rate. It also strengthens local skills and expertise, fosters the development of associated high-tech industries and raises the domestic value-added in electronics production.

Semiconductors are also a matter of national security. Dependence on imported chips makes the country’s critical infrastructure vulnerable to supply chain disruptions and hidden malware risks. The sweeping US chip export ban on China raises concerns in Vietnam as to whether its political differences from the West may lead to a similar fate in the future.

Hanoi has adopted a two-pronged strategy to reduce its vulnerability to these external threats. It maintains diplomatic neutrality amid geopolitical conflicts while gradually strengthening domestic capability in all three stages of the semiconductor value chain — chip design, front-end fabrication and back-end assembly and testing.

Vietnam’s industrial and technology policies have always granted the highest incentives for high-tech projects, including corporate income tax reduction and sales tax and land rent exemption.

Workers at an electronics factory in Vietnam. Photo: Facebook

In 2020, as tech firms continued to exit China, Vietnam established a special working group to court high-tech investments by offering customized incentives beyond those specified by existing laws. Different Vietnamese prime ministers have met with executives of global tech giants to encourage investment in semiconductors.

Generous incentives are not the only reason multinationals are pouring billions of dollars into Vietnam’s semiconductor ecosystem. One advantage of Vietnam over its regional neighbors is its pool of young engineering talent at a relatively lower cost.

Over 40% of Vietnamese college and university graduates are majoring in science and engineering, and Vietnam has been among the top 10 countries with the most engineering graduates.

As the risks of putting all one’s eggs in the China basket increase, semiconductor companies find Vietnam a promising option for their “China Plus One” strategy. The country’s northern manufacturing cluster is only a 12-hour drive away from Shenzhen, China’s manufacturing hub. That ensures minimal supply chain disruptions for those looking to diversify.

Vietnam also boasts one of the most open economies in the world, with 15 free trade agreements, an ever-improving business environment and a relatively stable government with clear socio-economic development plans. The country’s geopolitical neutrality is another plus for tech companies searching for a low-risk location to produce and export.

Vietnam’s semiconductor scene is evolving quickly across all stages of the value chain. Synopsys — a leader in chip design software — is shifting its investment and engineering training from China to Vietnam. The South Korean tech giant, Amkor Technology, signed a deal in 2021 to establish a $1.6 billion semiconductor manufacturing plant in Bac Ninh province.

Intel recently channeled an additional $475 million into its assembly and test plant in Vietnam that produces core processors. Local tech corporations have similarly launched their own lines of low-end semiconductors for a wide range of applications. Such projects are laying the foundation for even more investments to come.

The next step for Vietnam is to go beyond attracting foreign direct investment to integrating multinationals into its economy. Weaknesses in the country’s investment climate — including backward infrastructure, weak intellectual property rights enforcement, cumbersome procedures, underdeveloped supplier networks and a shortage of local skills — must be addressed urgently.

Vietnam should leverage foreign investors’ resources and expertise to catalyze improvements in its semiconductor ecosystem. The recent chip design training agreement between Synopsys and Saigon Hi-Tech Park is a welcome step in this direction.

Vietnam is cranking out engineering graduates to serve its burgeoning semiconductor industry. Image: Facebook

Another example is Samsung’s domestic supplier development program — jointly organized with the Ministry of Industry and Trade — enabling many domestic suppliers to become internationally competitive.

What Vietnam should not do is try picking winners to gain sovereign capability in semiconductors. Protecting local — especially state-owned — enterprises from foreign competition while subsidizing their operations only perpetuates the inefficient use of domestic resources.

The policy should focus on creating a business environment that enables all potential winners, foreign and local, to thrive.

Vietnam arming up to serve in US chip war on China - Asia Times

The CEO of Samsung Electronics met with Vietnamese Prime Minister Pham Minh Chinh and announced a US$850 million investment to manufacture semiconductor

asiatimes.com

It's not US but South Korea. US is in loggerhead with communist party of Vietnam after Vietnam pivot towards China.

South Korea saw Vietnam as the gateway for more Vietnam products export into China. The semi conductor plant is to serve China market as we are the biggest in the world.

Vietnam is intergrated into the bandwagon of China one belt one road.

 

[gambit]

It's not US but South Korea. US is in loggerhead with communist party of Vietnam after Vietnam pivot towards China.

South Korea saw Vietnam as the gateway for more Vietnam products export into China. The semi conductor plant is to serve China market as we are the biggest in the world.

Vietnam is intergrated into the bandwagon of China one belt one road.

As usual, you do not know what TF you are talking about.

This is a Samsung investment, and last we checked, Samsung is a SOUTH KOREAN company. That mean unless there is a secret tripartite agreement between the governments of China, Viet Nam, and the corporation of Samsung, to sell the semicon products from VN Thai Nguyen province only to China, this investment will serve any customer willing to pay market price.

 

[Nan Yang]

Samsung's plant in Thai Nguyen Province, northern Vietnam. Photo: Samsung

The CEO of Samsung Electronics met with Vietnamese Prime Minister Pham Minh Chinh and announced a US$850 million investment to manufacture semiconductor components in Thai Nguyen province on August 5, 2022.

The investment will make Vietnam one of only four countries – alongside South Korea, China and the United States – that produce semiconductors for the world’s largest memory chipmaker. Vietnam’s selection over more developed locations speaks volumes about the country’s rising importance in the semiconductor value chain.

Vietnam is not a newcomer to the semiconductor industry. The country’s first semiconductor plant, Z181, was established in 1979 to produce and export semiconductor components to the Eastern Bloc during the Cold War.

The collapse of the Soviet Union and the ensuing trade embargo put an end to the country’s first attempt at developing semiconductor capability. Yet the desire to enter the global semiconductor value chain lives on. For Vietnamese leaders, semiconductors represent both economic opportunities and national security interests.

Entry into the semiconductor value chain means tapping into a global market forecasted to reach US$1.4 trillion by 2029 with a 12% compounded annual growth rate. It also strengthens local skills and expertise, fosters the development of associated high-tech industries and raises the domestic value-added in electronics production.

Semiconductors are also a matter of national security. Dependence on imported chips makes the country’s critical infrastructure vulnerable to supply chain disruptions and hidden malware risks. The sweeping US chip export ban on China raises concerns in Vietnam as to whether its political differences from the West may lead to a similar fate in the future.

Hanoi has adopted a two-pronged strategy to reduce its vulnerability to these external threats. It maintains diplomatic neutrality amid geopolitical conflicts while gradually strengthening domestic capability in all three stages of the semiconductor value chain — chip design, front-end fabrication and back-end assembly and testing.

Vietnam’s industrial and technology policies have always granted the highest incentives for high-tech projects, including corporate income tax reduction and sales tax and land rent exemption.

Workers at an electronics factory in Vietnam. Photo: Facebook

In 2020, as tech firms continued to exit China, Vietnam established a special working group to court high-tech investments by offering customized incentives beyond those specified by existing laws. Different Vietnamese prime ministers have met with executives of global tech giants to encourage investment in semiconductors.

Generous incentives are not the only reason multinationals are pouring billions of dollars into Vietnam’s semiconductor ecosystem. One advantage of Vietnam over its regional neighbors is its pool of young engineering talent at a relatively lower cost.

Over 40% of Vietnamese college and university graduates are majoring in science and engineering, and Vietnam has been among the top 10 countries with the most engineering graduates.

As the risks of putting all one’s eggs in the China basket increase, semiconductor companies find Vietnam a promising option for their “China Plus One” strategy. The country’s northern manufacturing cluster is only a 12-hour drive away from Shenzhen, China’s manufacturing hub. That ensures minimal supply chain disruptions for those looking to diversify.

Vietnam also boasts one of the most open economies in the world, with 15 free trade agreements, an ever-improving business environment and a relatively stable government with clear socio-economic development plans. The country’s geopolitical neutrality is another plus for tech companies searching for a low-risk location to produce and export.

Vietnam’s semiconductor scene is evolving quickly across all stages of the value chain. Synopsys — a leader in chip design software — is shifting its investment and engineering training from China to Vietnam. The South Korean tech giant, Amkor Technology, signed a deal in 2021 to establish a $1.6 billion semiconductor manufacturing plant in Bac Ninh province.

Intel recently channeled an additional $475 million into its assembly and test plant in Vietnam that produces core processors. Local tech corporations have similarly launched their own lines of low-end semiconductors for a wide range of applications. Such projects are laying the foundation for even more investments to come.

The next step for Vietnam is to go beyond attracting foreign direct investment to integrating multinationals into its economy. Weaknesses in the country’s investment climate — including backward infrastructure, weak intellectual property rights enforcement, cumbersome procedures, underdeveloped supplier networks and a shortage of local skills — must be addressed urgently.

Vietnam should leverage foreign investors’ resources and expertise to catalyze improvements in its semiconductor ecosystem. The recent chip design training agreement between Synopsys and Saigon Hi-Tech Park is a welcome step in this direction.

Vietnam is cranking out engineering graduates to serve its burgeoning semiconductor industry. Image: Facebook

Another example is Samsung’s domestic supplier development program — jointly organized with the Ministry of Industry and Trade — enabling many domestic suppliers to become internationally competitive.

What Vietnam should not do is try picking winners to gain sovereign capability in semiconductors. Protecting local — especially state-owned — enterprises from foreign competition while subsidizing their operations only perpetuates the inefficient use of domestic resources.

The policy should focus on creating a business environment that enables all potential winners, foreign and local, to thrive.

Vietnam arming up to serve in US chip war on China - Asia Times

The CEO of Samsung Electronics met with Vietnamese Prime Minister Pham Minh Chinh and announced a US$850 million investment to manufacture semiconductor

asiatimes.com

From the 2 pictures, its just an assembly line. The first image shows a manual process. The second image shows an automated pick and place equipment. SMD label on the machine means Surface Mounted Device.

Gosh. There are numerous this type of assembly sites all over Malaysia, Taiwan, Thailand and China.

Anyway it's a first step. Congratulations.

Samsung's plant in Thai Nguyen Province, northern Vietnam. Photo: Samsung

The CEO of Samsung Electronics met with Vietnamese Prime Minister Pham Minh Chinh and announced a US$850 million investment to manufacture semiconductor components in Thai Nguyen province on August 5, 2022.

The investment will make Vietnam one of only four countries – alongside South Korea, China and the United States – that produce semiconductors for the world’s largest memory chipmaker. Vietnam’s selection over more developed locations speaks volumes about the country’s rising importance in the semiconductor value chain.

Vietnam is not a newcomer to the semiconductor industry. The country’s first semiconductor plant, Z181, was established in 1979 to produce and export semiconductor components to the Eastern Bloc during the Cold War.

The collapse of the Soviet Union and the ensuing trade embargo put an end to the country’s first attempt at developing semiconductor capability. Yet the desire to enter the global semiconductor value chain lives on. For Vietnamese leaders, semiconductors represent both economic opportunities and national security interests.

Entry into the semiconductor value chain means tapping into a global market forecasted to reach US$1.4 trillion by 2029 with a 12% compounded annual growth rate. It also strengthens local skills and expertise, fosters the development of associated high-tech industries and raises the domestic value-added in electronics production.

Semiconductors are also a matter of national security. Dependence on imported chips makes the country’s critical infrastructure vulnerable to supply chain disruptions and hidden malware risks. The sweeping US chip export ban on China raises concerns in Vietnam as to whether its political differences from the West may lead to a similar fate in the future.

Hanoi has adopted a two-pronged strategy to reduce its vulnerability to these external threats. It maintains diplomatic neutrality amid geopolitical conflicts while gradually strengthening domestic capability in all three stages of the semiconductor value chain — chip design, front-end fabrication and back-end assembly and testing.

Vietnam’s industrial and technology policies have always granted the highest incentives for high-tech projects, including corporate income tax reduction and sales tax and land rent exemption.

Workers at an electronics factory in Vietnam. Photo: Facebook

In 2020, as tech firms continued to exit China, Vietnam established a special working group to court high-tech investments by offering customized incentives beyond those specified by existing laws. Different Vietnamese prime ministers have met with executives of global tech giants to encourage investment in semiconductors.

Generous incentives are not the only reason multinationals are pouring billions of dollars into Vietnam’s semiconductor ecosystem. One advantage of Vietnam over its regional neighbors is its pool of young engineering talent at a relatively lower cost.

Over 40% of Vietnamese college and university graduates are majoring in science and engineering, and Vietnam has been among the top 10 countries with the most engineering graduates.

As the risks of putting all one’s eggs in the China basket increase, semiconductor companies find Vietnam a promising option for their “China Plus One” strategy. The country’s northern manufacturing cluster is only a 12-hour drive away from Shenzhen, China’s manufacturing hub. That ensures minimal supply chain disruptions for those looking to diversify.

Vietnam also boasts one of the most open economies in the world, with 15 free trade agreements, an ever-improving business environment and a relatively stable government with clear socio-economic development plans. The country’s geopolitical neutrality is another plus for tech companies searching for a low-risk location to produce and export.

Vietnam’s semiconductor scene is evolving quickly across all stages of the value chain. Synopsys — a leader in chip design software — is shifting its investment and engineering training from China to Vietnam. The South Korean tech giant, Amkor Technology, signed a deal in 2021 to establish a $1.6 billion semiconductor manufacturing plant in Bac Ninh province.

Intel recently channeled an additional $475 million into its assembly and test plant in Vietnam that produces core processors. Local tech corporations have similarly launched their own lines of low-end semiconductors for a wide range of applications. Such projects are laying the foundation for even more investments to come.

The next step for Vietnam is to go beyond attracting foreign direct investment to integrating multinationals into its economy. Weaknesses in the country’s investment climate — including backward infrastructure, weak intellectual property rights enforcement, cumbersome procedures, underdeveloped supplier networks and a shortage of local skills — must be addressed urgently.

Vietnam should leverage foreign investors’ resources and expertise to catalyze improvements in its semiconductor ecosystem. The recent chip design training agreement between Synopsys and Saigon Hi-Tech Park is a welcome step in this direction.

Vietnam is cranking out engineering graduates to serve its burgeoning semiconductor industry. Image: Facebook

Another example is Samsung’s domestic supplier development program — jointly organized with the Ministry of Industry and Trade — enabling many domestic suppliers to become internationally competitive.

What Vietnam should not do is try picking winners to gain sovereign capability in semiconductors. Protecting local — especially state-owned — enterprises from foreign competition while subsidizing their operations only perpetuates the inefficient use of domestic resources.

The policy should focus on creating a business environment that enables all potential winners, foreign and local, to thrive.

Vietnam arming up to serve in US chip war on China - Asia Times

The CEO of Samsung Electronics met with Vietnamese Prime Minister Pham Minh Chinh and announced a US$850 million investment to manufacture semiconductor

asiatimes.com

From the 2 pictures, its just an assembly line. The first image shows a manual process. The second image shows an automated pick and place equipment. SMD label on the machine means Surface Mounted Device.

Gosh. There are numerous this type of assembly sites all over Malaysia, Taiwan, Thailand and China.

Anyway it's a first step. Congratulations.