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Vietnam Sets Sights on First Semiconductor Plant as US Officials Raise Cost Concerns

Updated: Dec 18, 2023

Vietnam is in talks with chip companies to attract investment and potentially establish its first semiconductor plant, despite warnings from US industry officials about high costs.


The country, already home to Intel's largest semiconductor packaging and testing plant, is looking to boost its presence in the electronics manufacturing sector.

Meetings have taken place with several US chip firms, including fab operators, although the companies involved have not been disclosed. The aim is to build Vietnam's first fab, likely for less advanced chips used in cars or telecoms applications.

The discussions come after an upgrade in formal ties between Vietnam and the US, with President Joe Biden describing Vietnam as a "critical player" in global semiconductor supply chains. However, US chipmaker GlobalFoundries, which attended a business summit during Biden's visit, has shown no immediate interest in investing in Vietnam.

The Vietnamese government is keen to establish its first fab by the end of the decade and has promised "the highest incentives available" to chip companies. It may also support local firms, such as Viettel, in building fabs with imported equipment.

While Vietnam is eager to attract semiconductor investment, some industry experts have urged caution.

Robert Li, Vice President of US chip design firm Synopsys, warned that building a foundry could cost as much as $50 billion and would require competing with other countries that have announced significant spending plans on chips. John Neuffer, President of the US Semiconductor Industry Association, suggested that Vietnam focus on sectors where it already has strength, such as assembling, packaging and testing.

  • Vietnam is in talks with chip companies to establish its first semiconductor plant.

  • The aim is to build a fab for less advanced chips used in cars or telecoms applications.

  • US chipmaker GlobalFoundries has shown no immediate interest in investing in Vietnam.


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