Behind the visits of the world's billionaires to Vietnam

Vietnam has become a 'hot' keyword in international media when talking about the semiconductor and chip industry. In particular, in 2024, the frequent visits of technology billionaires also show that foreign investors have been and continue to keep an eye on Vietnam's great potential in this 'trendy' industrial sector.

Semiconductors "heat up" FDI capital

According to Nikkei Asia in mid-August, Alchip Technologies - Taiwan's leading AI chip design service provider - is expanding its research and development (R&D) team to Vietnam, where it plans to open its first office this year. Alchip Technologies' company in Vietnam is expected to increase its staff to 100 engineers within 2-3 years. Speaking to Nikkei Asia , the company's senior leaders also said they were impressed with the work ethic, dedication, and commitment of Vietnamese engineers and that this is "an extremely attractive option for us". At the same time, chip technology corporations in Korea are also shifting to invest in Vietnam; Marvell (USA) puts Vietnam in a "strategic position to develop technical talent" with the goal of increasing the number of local employees to about 500 people by 2026; Synopsys - the world's leading chip design tool maker - is considered one of the most active companies investing in Vietnam, with more than 500 employees in many design centers in the country. According to Nikkei Asia , Vietnam has attracted about 40 international companies in the semiconductor industry from the US, South Korea, Japan, Taiwan and the Netherlands. Along with this wave, domestic companies such as Viettel and FPT have started operating, building a comprehensive foundation for the industry. "The availability of technology human resources in a time of shortage can help Vietnam achieve one of its long-cherished dreams of moving up the technology value chain," the newspaper commented, saying that Vietnam has become a magnet in the chip industry with quality human resources at affordable prices.

Mr. Tim Cook at the meeting with Prime Minister Pham Minh Chinh

PHOTO: NHAT BAC

In a rhythmic manner, since the name of Vietnam has been continuously mentioned on international media channels about the potential for developing semiconductor technology, rare earth reserves..., the visits of the owners of many leading technology corporations in the world have also become more bustling. For example, billionaire Jensen Huang - CEO of the world's largest chip corporation NVIDIA - came to Vietnam and met with Prime Minister Pham Minh Chinh regarding the field of artificial intelligence (AI) as well as Vietnam's human resources in this field. At that time, billionaire Jensen Huang said that Vietnam has the potential and attractiveness for developing AI and affirmed that he would support Vietnam in building and developing the semiconductor industry in the near future. Not long after, 4 months later, the Vice President of NVIDIA Corporation led a delegation to Vietnam to find land to build a factory. Also this year, billionaire Bill Gates flew to Da Nang on a private jet, a very private journey but caused a stir in the domestic and international media. Because this is the third time Bill Gates has come to Vietnam to conduct business activities related to the information technology sector. BNN Breaking commented that Bill Gates' return after 18 years is "proof of Vietnam's growing attractiveness". At the same time, the appearance of the world's top 11 billionaires at the Binh Dinh Province Investment Promotion Conference 2024 at the end of March also made a lot of ink in the domestic and international press. Then the short trip of Apple CEO - billionaire Tim Cook - in April... According to the announcement of Mr. Tim Cook's trip, Apple said it would increase spending on suppliers in Vietnam, along with new progress in the initiative to support clean water for local schools. The company has spent nearly 400,000 billion VND since 2019 through the local supply chain and has more than doubled its annual spending in Vietnam during the same period.

Billionaire Jensen Huang - Chairman and CEO of NVIDIA, to visit Vietnam at the end of 2023

PHOTO: VNA

Eagles nest in fledgling industry

As expected, the first billion-dollar project this year related to the semiconductor sector has appeared. Very quickly after putting the first phase of the project into operation, at the end of June, the giant in the semiconductor industry - Amkor (Korea) - officially increased its investment capital by more than 1 billion USD for the project in Bac Ninh. Amkor is one of the world's largest providers of outsourced semiconductor testing and packaging services, co-founded by a Korean, but headquartered in the US. Notably, Amkor is a pioneer in processing, testing and packaging electronic microchips and is currently a strategic manufacturing partner for many large technology corporations worldwide such as Samsung and Apple. Along with Amkor, a number of other large US semiconductor companies such as Intel, Marvell and GlobalFoundries... also have significant investment commitments in Vietnam, which according to many experts, these giants will "shape the future of the semiconductor ecosystem" in Vietnam. Because behind the "eagle", there are flocks of birds, big and small, coming to nest together. That is Signetics Corporation - a semiconductor supplier for many large corporations such as Samsung and SK - announced plans to build a factory in Vinh Phuc with a total investment of about 100 million USD, the factory is expected to officially come into operation at the end of next year. The 125 million USD investment project of Inventec Appliances Co., Ltd. (Taiwan) is expected to come into operation from the fourth quarter of this year. Most recently, at the 2024 Da Nang Semiconductor Day event organized by Da Nang at the end of August, there were a series of cooperation agreements and memorandums of understanding signed on cooperation in developing the semiconductor sector between the city government and famous corporations in this field such as: Synopsys International, Viettel, Sovico, Marvell Vietnam, Makara Capital Partners...

NVIDIA Vice President visits the new generation and only data center in Vietnam of CMC DC Tan Thuan

PHOTO: Contributor

Professor Nguyen Mai, Chairman of the Association of Foreign Investment Enterprises, commented that semiconductors are "heating up" foreign investment flows into Vietnam and predicted that attracting investment in high-tech fields, semiconductor chips, etc. will be more active in the coming time. Currently, electronics and semiconductors account for about one-third of Vietnam's export turnover, most of which are produced by foreign direct investment companies. "The young semiconductor industry in Vietnam has technology "eagles" nesting. This will be an important foundation for us to accelerate and put Vietnam on the world semiconductor map as soon as possible. Semiconductors are a key industry of many countries around the world and the race to enter this industry in Vietnam is "heating up", Mr. Mai expected.

Two advantages and the "trump card" of rare earth

Of course, it is not without reason that the world's billionaires favor Vietnam. In fact, Vietnam possesses 3 advantages to become the top choice of investors. The first is the geopolitical advantage. If you take Vietnam as the center and rotate a circle with a radius of 4-5 hours by plane, you can fly to the points that account for 70% of the world's semiconductor industry. Vietnam has political stability, is in the group of countries with fast growth rates, and has the aspiration to successfully build a semiconductor industry. Second, Vietnam possesses an abundant source of young and technologically savvy human resources, has an advantage in design and has a training strategy to develop 50,000 semiconductor workers. The third is rare earth with the second largest reserves in the world, about 22 million tons, only after China (44 million tons). Notably, Vietnam is also the only country outside of China with a vertically integrated rare earth magnet supply chain and has attracted interest from companies in many sectors. During his visit earlier this year, US Deputy Secretary of State Jose W. Fernandez also made it clear: "Semiconductors are the main reason I came to Vietnam!".

NVIDIA signs cooperation agreement with FPT

PHOTO: Contributor

According to energy expert Khuong Quang Dong, rare earth is the "trump card" for Vietnam to develop and participate in the global semiconductor and microchip supply chain. The world's 4.0 industries are racing to obtain supplies of important minerals such as rare earth used for electric cars, semiconductors, mobile phones and other products. He emphasized: "Vietnam has abundant rare earth reserves, but does not have environmentally friendly mining technology and deep processing technology that is safe for the environment. Therefore, if we cooperate and receive support from the US to explore, evaluate reserves, exploit, process, etc., Vietnam will certainly have a good position and be secure in the global semiconductor supply chain. Obviously, the opportunity for Vietnam is huge". Sharing the same view, global microchip expert, Professor, Dr. Dang Luong Mo, also affirmed that rare earth is a huge advantage for Vietnam in the world chip supply chain. If exploited properly, this precious resource will help Vietnam gradually participate deeply in the global semiconductor chain. However, Vietnam's plans for the rare earth sector have not yet been completed. "The US raises the issue of rare earth, which means urging us to complete the plan soon to attract investment. Currently, the capacity of domestic enterprises can completely meet the requirements of US technology corporations, including the design of microchips. Vietnam has an advantage in the skills of assembling, testing and packaging microchips. However, if it cannot master the technology, exploit the source of raw materials, design, etc., the added value that Vietnam earns in the semiconductor industry will hardly be as expected. Thus, the advantage is also a big challenge, if we do not find opportunities to exploit and master the source of semiconductor materials." Discussing further about exploiting the advantages, Professor Dang Luong Mo suggested that Vietnam should choose the "rich" stage to do in the 4 stages of microchip manufacturing (design, manufacturing, testing and packaging). He analyzed: Currently, many large foreign enterprises have performed all 4 stages in Vietnam. For example, Qualcomm and most of the microchip design companies currently operating in Vietnam are all engaged in design; manufacturing is TSMC; packaging is Intel Vietnam. "In the 4 stages mentioned above, design and innovation require high technology, high skills and are also the most expensive stages. And the progress of microchip technology to date has mainly focused on these 2 stages because they are prioritized for investment in both money and human resources. If Vietnam wants to successfully participate in the semiconductor chain, it should choose this difficult stage because we already have great potential," Professor Dang Luong Mo recommended.

In the semiconductor technology sector, Vietnam has begun to realize its aspirations by issuing policies focusing on attracting high-quality FDI and enhancing training. In addition, Vietnam possesses an abundant, highly skilled young workforce, a strategic geographical location, a growing consumer market, competitive operating costs, and above all, has signed many free trade agreements with countries and territories. That is why Vietnam was chosen. Ms. Daphne Lee , Head of Corporate Banking Services, HSBC Taiwan

In the US, the average salary for a semiconductor engineer is nearly $8,500 a month. Meanwhile, Japanese chipmaker Tokyo Electron pays nearly 305,000 yen (nearly $2,200 a month) to new graduates who can start working immediately. In Taiwan, statistics from the Taiwan Ministry of Education show that semiconductor engineers with a bachelor's degree receive a starting salary of about 38,000-42,000 NTD (25-33 million VND). For the same position but with a master's degree, workers can receive 33-37 million VND, or 46-55 million VND if they have a doctorate. In Vietnam, websites post job vacancies for semiconductor engineers with a starting salary of $1,000 a month.

A report released by the Ministry of Information and Communications in 2023 showed that Vietnam ranked third in Asian markets in terms of semiconductor chip exports to the US, after Malaysia and Taiwan. Vietnam is also among the leading countries in increasing chip exports to the US, along with Thailand, India and Cambodia. From February 2022 to February 2023, the revenue from the US market of the Vietnamese chip industry increased by nearly 75%, from 321.7 million USD to 562.5 million USD, accounting for 11.6% of the market share.

Thanhnien.vn

Source: https://thanhnien.vn/dang-sau-nhung-chuyen-tham-cua-cac-ti-phu-the-gioi-toi-viet-nam-18524101016213829.htm