Vietnam - "Good Land" for Semiconductor Industry

The visit opened new doors

According to US Commercial Counselor to Vietnam Lynne Gadkowski, the establishment of the Comprehensive Strategic Partnership has opened new doors for Vietnam and the US to cooperate in education, clean energy and science and technology towards an innovative economy and bring Vietnam to a higher position in the supply chain. The US is currently a comprehensive strategic partner in supporting Vietnam to realize these goals.

Vietnam has been making major changes and the US is ready to accompany in that process. “I want to emphasize the importance of the investment environment in Vietnam. Besides attractive elements such as land, incentives and skilled labor, another extremely important factor is access to green technology; clean, green energy", said US Commercial Counselor Lynne Gadkowski.

Recalling her visit to the headquarters of a medical and aviation equipment manufacturing enterprise in Ho Chi Minh City last October, Lynne shared her impression of the completely closed rooftop solar energy system implemented by this enterprise. According to Lynne, the environmental sustainability goal (ESG) is also a key factor for US investors and foreign investors in general when making choices about partners.

Besides, US President Joe Biden's visit and the decision to upgrade bilateral relations between Vietnam and the US also contribute to promoting the digital economy, with the content of the two sides agreeing to further cooperate in building a safe, reliable, and secure connection network; ensuring and effectively managing users’ data; cooperating in the development of areas such as AI and 5G.

“Overall, Vietnam holds a clear vision and strong political commitment in the field of innovation in general and the semiconductor industry in particular. You have sown the seeds on fertile ground, the next thing is to maintain the rows of sturdy trees to grow. That is also what the Governments of Vietnam and the US are committed to and aiming for”, said US Commercial Counselor to Vietnam Lynne Gadkowski.

Manufacturing electronic circuit boards at Katolec Vietnam Co., Ltd., Quang Minh Industrial Park, Hanoi. (Photo: kinhtedothi.vn)

Increased presence and cooperation in the semiconductor sector

Lynne Gadkowski commented that the recent Covid-19 pandemic has provided a clearer view of the challenges of the supply chain and for important materials in general, including semiconductors.

Sharing about our cooperation potential of Vietnam in this field, Lynne Gadkowski mentioned Amkor Semiconductor Group with an investment of USD 1.6 billion in Bac Ninh province, announced in last October. The presence of such large-scale enterprises can increase Vietnam's contribution to the global supply chain.

In addition, Lynne Gadkowski emphasized that the US side is also coordinating closely with Vietnamese authorities to build Vietnam's National Semiconductor Strategy by providing important inputs from American research centers and experts. "Once completed, the strategy will provide clearer views on how Vietnam views this field in the future”, said the US Commercial Counselor.

According to Kim Huat Ooi, Vice President and General Director of Intel Products Vietnam Co., Ltd., in the context of the global trend of industrialization and modernization, every country now needs semiconductor chips - an important input material for electronic devices and components. Referring to the milestone of establishing the Vietnam – US Comprehensive Strategic Partnership during President Biden's recent visit, Kim affirmed that Vietnam would have more opportunities to attract FDI in the semiconductor field.

Nearly 20 years ago, Intel was the first high-tech investor in Vietnam. "Vietnam has come a long way and now not only Intel but other multinational companies have been increasing their presence here", said Kim.

Human resources are a vital factor

Human resources are considered a challenge for many countries in developing the semiconductor market and Vietnam is of no exception. Recalling her visit to Ho Chi Minh City last month, Counselor Lynne Gadkowski said that the manufacturing unit she visited grew by 50% each year, but the workforce only increased by 15%, illustrating the challenge of the semiconductor labor market.

The US and Vietnam are discussing STEM education cooperation, as well as English training for mid-level and technical professionals. The US Agency for International Development (USAID) is also collaborating with the Vietnamese Ministry of Industry and Trade and the Ministry of Planning and Investment on additional cooperation policies. “In addition, businesses and investors globally also attach great importance to a market that ensures compliance with labor standards to prevent trafficking and abuse of child labor... to ensure "clean supply chain", said Lynne Gadkowski.

Regarding human resources, Kim commented that Vietnam has a high number of bachelor's degrees but still lacks forces with higher professional qualifications such as master’s and doctorate, while research and development fields (R&D) require higher levels of knowledge and skills.

For Vietnam's progress to be more solid

Many foreign businesses have shared that Vietnam is an attractive destination with the stability of the socio-political system, young and highly educated workforce, and strategic location in the center of Asia with direct access to important trade routes and shipping channels.

To further promote its strengths, a representative of Intel said that Vietnam should promote current business support programs, especially preferential tax rates along with modernizing incentive programs.

Like many other fields including semiconductors, simplification of administrative procedures, as well as infrastructure and higher quality professional training are also plus points. Kim emphasized: "Intel also hopes that leaders of the locality will empower the one-stop mechanism in making decisions to accelerate direct interaction with investors for sustainable development”.

Referring to the Vietnamese Government's VND 140 trillion investment plan in national electricity development, the leader of Intel Group also said that improving the quality of infrastructure, such as transportation and electricity, is very important. To increase the competitiveness of Vietnam in the market to attract semiconductor investment, the US Commercial Counselor once again emphasized the insurance of the investment environment. Many other countries have convenient “one-stop” mechanisms dedicated to strategic types of investments and high-quality investments. "We also hope this is part of the vision of the Vietnam Innovation Center", said Lynne.

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