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Vietnam Initiates Talks to Establish Its First Semiconductor Chip Factory

Vietnam is actively engaged in discussions with a consortium of semiconductor chip manufacturers, with the ambitious goal of fostering increased investment within the country and potentially establishing its very first semiconductor chip factory. These efforts come in the face of warnings from U.S. industry officials concerning the potential high costs associated with such an endeavor.

Notably, Vietnam is already home to the world’s most extensive semiconductor chip packaging and testing facility for the U.S. technology behemoth, Intel. Additionally, the nation houses software companies responsible for chip design from across the globe. In line with its strategic objectives, Vietnam is actively seeking to attract more investments in semiconductor chips, particularly from foundries specializing in chip production.

The head of the Vietnam office of the US-ASEAN Business Council revealed that Vietnam has recently engaged in discussions with approximately six U.S. chip companies, including chip factory operators. However, the specific identities of these companies remain undisclosed due to the ongoing, preliminary nature of these negotiations.

One chip executive, who chose to remain anonymous as they lacked authorization to address the media, indicated that among the potential investors involved in these discussions are Global Foundries, a U.S. contract manufacturer, and Taiwan’s PSMC. These deliberations center on the establishment of Vietnam’s inaugural semiconductor chip factory, with a greater likelihood that it will specialize in chips intended for use in automobiles or telecommunications applications.

These developments follow the significant enhancement of formal relations between Vietnam and the United States in September. During this time, U.S. President Joe Biden paid a historic visit to Hanoi, during which the White House highlighted Vietnam’s potential role in the global semiconductor chip supply chain.

Although Global Foundries attended the business summit held during President Biden’s visit to Vietnam, the company has not yet expressed immediate interest in investing in Vietnam. This ongoing dialogue signals Vietnam’s determined intent to assert its presence in the semiconductor industry and attract vital investments to bolster its technological capabilities.

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