Vietnam is chances before the chip manufacturing technology race?
Vietnam is an attractive destination for many of the world’s leading electronic chip manufacturers. If you take advantage of opportunities and are well prepared, in the future, this industry in Vietnam promises to achieve a high growth rate, and will gradually catch up with the general level in the global market and become one of the key spearheads of the national economy. Let’s join RX Tradex to learn about the opportunities of Vietnamese enterprises before the race of electronic chip manufacturing technology and the general situation of the global market at the present time through the article below.
1. Overview of the electronic chip manufacturing industry.
1.1. Global electronic chip market.
How is the electronic chip market in the world going? Currently, Taiwan and South Korea are considered the two largest semiconductor manufacturing hubs, accounting for more than half of global electronic chip production . In particular, Taiwanese chipmaker TSMC is the largest company in the industry in terms of scale and output. In addition, in 2022, the group announced the construction of its second super factory in Arizona with an investment of $ 12 billion, bringing TSMC’s total investment in US soil to $ 40 billion. [1]
Besides, another big player in the electronic chip industry, the United States, due to its focus on design, has gradually lagged behind in manufacturing techniques and is trying to catch up with other regions. So last year, the U.S. enacted the $52 billion CHIP Act, which aims to support the country’s rapidly growing chip industry. [2]
In Europe, large businesses are also focusing on miniature processors, mainly used in the automotive industry. At the moment, Europe is trying to get back into the chip race, through trade partnerships, including Vietnam. And to catch up with other competitors, the European Parliament has just passed the CHIP Act with an investment of 43 billion euros, focusing on the main goal of strengthening research and development of the semiconductor industry. [3]
1.2. Vietnam electronic chip market.
What is the electronic chip market in Vietnam today? Vietnam ranks 9th in the world in the field of electronics exports. Thanks to possessing this available strength, many industry experts believe that our country has the opportunity to become the world’s chip manufacturing center in the future. Especially in the context of many large technology corporations such as Intel, Samsung,.. all announced plans to boost semiconductor production in Vietnam. In fact, Vietnam is home to Intel’s largest assembly and inspection plant with a total investment of $1.5 billion. It is estimated that this factory will account for up to 70% of Intel’s total production globally. [4]
According to Tuoi Tre newspaper, as of February 2023, Vietnam has exported electronic chips to the US with sales of 562.5 million USD, up about 240.8 million USD over the same period last year. Thereby, putting Vietnam third in Asia in semiconductor chip exports to the US. [5] Since then, Vietnamese enterprises are gradually asserting their position in the electronic chip manufacturing market, while becoming an important link in the global supply chain.
2. Opportunities for Vietnamese enterprises before the race of electronic chip manufacturing technology.
2.1. Vietnam is an attractive destination for global FDI.
In recent years, Vietnam has always been known as a leading destination for technology corporations, with the desire to set up electronic chip factories. According to the Industry and Trade newspaper, Samsung plans to inaugurate a Research and Development (R&D) Center in Hanoi in early 2023. This is considered the R&D center of Samsung Group for the whole Southeast Asia region. Previously, Vietnam also received investment from Intel Corporation with the establishment of the largest assembly and inspection plant in its network. [6]
The investment of leading corporations in the electronic chip industry has made Vietnam make great strides towards the opportunity to attract FDI enterprises. From there, Vietnamese enterprises will have access to and learn the latest chip manufacturing technologies in the world.
2.2. Improve the quality of personnel for electronic chip manufacturing activities.
According to the Deputy General Secretary of the Vietnam Electronics Business Association, in order to attract corporations to expand investment in the chip manufacturing technology industry, our country needs to focus on training high-quality human resources. [7] In particular, universities and vocational training centers need to have close links with enterprises, to train suitable personnel for the goal of applying technology to electronic chip production. Typically, technology corporations: Samsung, Apple,… have cooperated with many Vietnamese enterprises to train and improve skills for many engineers and high-quality workers. At the same time, overseas training activities are also invested and organized annually by many FDI enterprises.
In addition, high-quality human resources in Vietnam’s IC sector also receive high appreciation from professionals. According to GS. TS. Dang Luong Mo, Vietnam has been designing chips for the past 20 years, with over 2,000 engineers qualified to work in the international market. [8] Therefore, Vietnam needs to take advantage of these human resources to help the electronic chip industry grow stronger in the near future.
2.3. Combine with leading corporations to catch up with electronic chip manufacturing technology in the world.
At the present time, two leading technology enterprises in Vietnam, Viettel and FPT, are also making very strong strides in applying electronic chip manufacturing technology. In 2022, FPT Corporation announced an integrated semiconductor chip line designed in Vietnam and manufactured in Korea. [9] In addition, Viettel Group together with Qualcomm announced the successful research and production of the world’s first 5G base station radio block using ASIC chipsets according to Open RAN standards. [10]
Since then, it shows that, although Vietnamese enterprises have only initially started to produce semiconductor chips, this is the field that requires the most modern technology and techniques in the world. But the bright spots in recent years, with efforts to gradually catch up with the electronic chip production technologies of two leading Vietnamese corporations will be the catalyst, bringing our country soon to integrate into the global market.
2.4. Extensive participation in global supply chains.
A great opportunity for Vietnamese enterprises in the coming time in the field of electronic chip production is that countries such as the US, UK, South Korea, Japan,.. start moving factories to potential regions outside China. This comes from the impact of economic policies, politics and the global race to produce semiconductor chips. From there, Vietnamese enterprises can participate more deeply in the global supply chain in this field of electronic chips.
If Vietnam solves the difficulties in meeting the standards of technology and high-quality personnel, it will increase its chances of becoming a leading country in the global supply of electronic chip manufacturing.
3. Summary.
In summary, through the article “Opportunities of Vietnamese enterprises before the race of electronic chip manufacturing technology”, RX Tradex hopes that businesses can understand the overview of the global market in the field of electronic chip manufacturing and clearly determine the future direction to have the best preparation. Besides, this year, enterprises wishing to learn more about the latest electronics manufacturing technologies, can immediately participate in the Vietnam Manufacturing Expo organized by RX Tradex Vietnam. In addition, in 2023, RX Tradex will also organize leading exhibition events in the region such as NEPCON Vietnam, METALEX Vietnam and Waste and Recycling Vietnam to be held in 2024.
Note:
[1]: The semiconductor race.
[2], [4]: Vietnam has the opportunity to become a chip manufacturing hub.
[3]: Through the Chip Act, the EU will mobilize $47 billion in public and private investment.
[5], [10]: Chip Viet has just started the race.
[6], [7]: Electronic chip manufacturing industry.
[8]: Vietnam before the opportunity to become a leading chip manufacturer.
[9]: What opportunities for ‘Make in Vietnam’ chip production today – mekongasean?
