Semiconductor industry - great opportunity for Vietnam

'In the near future, I believe Vietnam will become a reliable partner and an important link in the global semiconductor value chain'.

Representatives of investors and Minister Nguyen Chi Dung took a souvenir photo at the National Innovation Center on December 11, 2023 - Photo: MPI

Minister of Planning and Investment Nguyen Chi Dung told Tuoi Tre in an interview in early 2024. He said the Government has been and will continue to create all favorable conditions for the world's leading semiconductor corporations to invest in Vietnam, thereby gradually shaping the development of the domestic semiconductor industry, helping Vietnam rise to become a developed country.

Vietnam is increasingly attractive...

Minister Nguyen Chi Dung

* Dear Minister, last year the Ministry of Planning and Investment worked with many of the world's leading semiconductor corporations to invite them to invest and cooperate with Vietnam. Could you share the results achieved and plans for the coming years? - In recent times, many large technology companies in the world have cooperated with the National Innovation Center (NIC) to implement many innovation programs and activities, support businesses in digital transformation and train and develop digital human resources such as Google, Meta, Siemens, Hitachi... In 2023, through contact and exchange activities at all levels, the Ministry of Planning and Investment has proactively proposed cooperation and called for investment in the field of innovation with leading enterprises in the world. Through that, many large corporations such as John Cockerill, Synopsys, Cadence have signed cooperation agreements with NIC. At the Vietnam Innovation International Exhibition 2023, innovation facilities and semiconductor chip design incubation centers of large technology enterprises such as Samsung and Synopsys were opened at NIC Hoa Lac. Along with that, the exhibition also gathered hundreds of large technology enterprises and corporations to participate, especially large international corporations such as SK, Samsung, Google, Meta, SpaceX, John Cockerill, Synopsys, Cadence, VISA... This shows that Vietnam is becoming more and more attractive to technology corporations around the world. In the last months of 2023, the world's leading semiconductor enterprises such as Nvidia, members of the US Semiconductor Industry Association (Intel, Qualcomm, Ampere, ARM, Synopsys, Infineon) also came to work with the Ministry of Planning and Investment to seek investment and business opportunities, expanding the market of operations in Vietnam through cooperation with NIC and domestic enterprises. Based on the cooperation results, the Ministry of Planning and Investment is directing NIC to focus on implementing the cooperation contents agreed with major partners, and at the same time proactively seek and promote cooperation with the world's leading partners in key areas to establish operations at NIC's operating facilities, especially the NIC Hoa Lac facility. Thereby contributing to promoting growth based more on new driving forces such as digital economy, science and technology, semiconductor chips, renewable energy, hydrogen... * The semiconductor industry is opening up great opportunities for Vietnam, but in your opinion, are there any challenges when the investment capital for semiconductor chip factories is up to tens of billions of USD? Where can we start, what is the role of the Government in supporting and accompanying enterprises? - In the context of the semiconductor value chain gradually shifting to Southeast Asian countries, Vietnam has all the necessary conditions and factors to develop the semiconductor industry such as a stable political system, favorable geographical location, attractive investment incentive policies, abundant technical and technological human resources, and increasingly developed digital infrastructure. The Government is highly determined in pursuing the development of the semiconductor industry, and has been attracting more and more large corporations in this industry to Vietnam. Many large corporations in the electronics and semiconductor industry are present and have plans to expand investment in Vietnam such as Intel, Samsung, Synopsys, Qualcomm, Infineon, Amkor... This demonstrates the key and increasingly important role of Vietnam in the global semiconductor supply chain. According to research by the Boston Consulting Group (BCG), in the period 2001 - 2021, the global semiconductor industry grew by 13% per year, reaching a scale of about 600 billion USD. The semiconductor industry is expected to continue to grow strongly, reaching a scale of about 1,000 billion USD by 2030. The world's largest economies such as the US, China, the EU, South Korea and Japan have all announced plans to subsidize the semiconductor manufacturing industry, creating a competitive edge in the world technology industry. This industry is opening up many opportunities for all countries, including Vietnam, specifically new technologies such as artificial intelligence, self-driving cars, Internet of Things (IoT) are increasingly developing, the demand for semiconductor components is also increasing. In addition, chip production can create great export opportunities, especially when many countries are looking for a safe and independent supply source in the semiconductor field. However, the semiconductor industry also poses challenges for businesses and governments. These are high investment costs, huge investment levels for chip production, requiring special infrastructure and complex production lines. In fact, building a chip foundry can cost up to 50 billion USD. International competition in the semiconductor industry is also very high, especially in countries like China, the US and Europe. These countries/regions have announced plans for their chip sector from 50 - 150 billion USD. In addition, technological challenges, the increasing complexity of semiconductor technology requires large investments in research and development (R&D) to maintain competitiveness. The demand for high-quality human resources is very high, while the quality of human resources in Vietnam is only at the initial stage, skills and qualifications are not enough to meet the needs of enterprises. The semiconductor industry has appeared in Vietnam for many years, but we do not have a national development strategy. Therefore, this field in our country is still quite primitive, without deep participation of domestic enterprises, mainly foreign enterprises participating. In order for the semiconductor industry in our country to develop commensurate with its existing advantages, the Ministry of Planning and Investment is focusing on the following contents to gradually form this high-quality industry. That is, improving the quality of human resources, with the construction of a project to develop high-quality human resources by 2030. The project will clarify the overall picture of human resources for Vietnam's semiconductor industry by 2030 with the goal of training 50,000 human resources in the semiconductor industry. This human resource will provide enough human resources for domestic semiconductor enterprises and export to other developed markets. Building separate mechanisms and policies to attract and take advantage of foreign investment, according to Decree 94 specifically for NIC issued by the Government in 2020, has provided policies and levels of incentives for enterprises in the NIC's innovation ecosystem. Including incentives for semiconductor enterprises when entering the Vietnamese market. Specifically, enterprises are entitled to a corporate income tax rate of 10% for 30 years from the first year of revenue, tax exemption for 4 years and a 50% reduction in payable tax for no more than 9 subsequent years from the time of taxable income; are exempted from import tax on raw materials, supplies and components that have not been produced domestically and are imported for production within 5 years from the start of production...

Investing in building R&D centers, thereby creating a favorable environment for Vietnamese researchers and businesses to access new technologies. During the visit to the US, witnessed by Prime Minister Pham Minh Chinh, NIC signed a memorandum of understanding with Cadence Corporation and Arizona State University (ASU) to establish a microchip design research and incubation center at Hoa Lac High-Tech Park.

Workers at the million-dollar factory of Hana Micron Vina Co., Ltd., a Korean FDI company, in Bac Giang - Photo: GIANG SON DONG

Training 50,000 semiconductor engineers

* According to the Minister, what do we need to do to achieve the ambitious goal of training 50,000 engineers for the semiconductor industry in the coming years? - This is a correct, important and decisive decision to increase investment attraction in the semiconductor industry. In particular, the Government is assigning the Ministry of Planning and Investment to preside over and coordinate with the Ministry of Information and Communications, the Ministry of Education and Training and relevant agencies to research and develop a Project on human resource development for the semiconductor industry with the goal of training and developing 50,000 human resources for the industry by 2030. To create momentum for the implementation of this project, the Ministry of Planning and Investment has assigned NIC to sign a cooperation agreement with the two largest US chip design corporations, Synopsys and Cadence, to cooperate in establishing research centers and incubating semiconductor microchip designs; Coordinated with more than 30 major domestic and international universities and research institutes to implement human resource training programs. At the same time, NIC has coordinated with SunEdu Company, Arizona State University and Cadence Group to organize in-depth training courses on microchip design for lecturers and engineers who want to improve their expertise at NIC facilities. The Vietnam Innovation Challenge program is part of the Vietnam Innovation Initiative chaired by the Ministry of Planning and Investment, co-organized by NIC and Meta Group to seek innovative solutions from organizations/individuals around the world to solve important national challenges, towards a prosperous and sustainable Vietnam. The theme of the 2024 program is "Innovation with enterprises to promote the semiconductor industry and smart manufacturing to conquer the global market". The project will also ensure that the output of future semiconductor human resources is exposed to human resource needs and support business development through programs to support engineers working at home and abroad, support startups, build an innovation ecosystem, support learning exchanges and prioritize the use of products with high localization rates. At the same time, create a solid financial mechanism to meet project funding needs based on budget sources, from socialization, international sponsorship and legal revenue sources to arrange reasonable funding for training programs, scholarships and training organizations. * What do you think about the development prospects of Vietnam's semiconductor industry in the future? - The US President's commitment and support for Vietnam to participate in the global high-tech value chain and the chip and semiconductor industry has opened up great opportunities for us to join the world's high-value production network. Many large corporations and enterprises in the electronics and semiconductor industry have been present and are planning to expand their investment in Vietnam such as Intel, Samsung, Synopsys, Qualcomm, Infineon, Amkor... This demonstrates the key and increasingly important role of Vietnam in the global semiconductor supply chain. Recently, the Ministry of Planning and Investment, through NIC, has signed a cooperation agreement with the two largest US chip design corporations, Synopsys and Cadence, to cooperate in establishing research centers and incubating semiconductor microchip designs. At the same time, it has coordinated with more than 30 large domestic and international universities and research institutes to implement human resource training programs, and coordinated with major research institutes in Korea and Taiwan to set up representative offices and research offices at NIC. The Government has been and will strive to prepare the best conditions to be ready to welcome investors in the semiconductor industry. In the near future, we believe that Vietnam will become a reliable partner and an important link in the global semiconductor value chain.

Many large corporations and enterprises in the electronics and semiconductor industry are present and planning to expand their investment in Vietnam, such as Intel, Samsung, Synopsys, Qualcomm, Infineon, Amkor... This demonstrates the key and increasingly important role of Vietnam in the global semiconductor supply chain.

Minister of Planning and Investment Nguyen Chi Dung

Support domestic enterprises to participate in the global semiconductor value chain

In recent times, the National Innovation Center (NIC), under the Ministry of Planning and Investment, has implemented many programs and activities to support businesses in digital transformation, providing resources to support innovation and startups, as well as connecting businesses with other elements in the startup and innovation ecosystem. In the coming time, NIC will focus on supporting businesses in eight areas: smart cities, smart factories, cybersecurity, digital content, environmental technology, medical technology, semiconductor industry and green hydrogen technology. In particular, NIC will prioritize resources to support businesses to gradually participate in the value chain in the semiconductor industry. NIC's existing operating facilities will provide testing areas for technology businesses following the world's advanced models. In addition, the center continues to coordinate with partners to implement support, consulting and connection programs and projects to assist businesses in improving their technological capacity and digital transformation... The Ministry of Planning and Investment is also researching and reporting to the Government and the Prime Minister to amend and supplement special and breakthrough mechanisms and policies for NIC to better support innovation and start-up activities.

Universities race to train microchip human resources

Vietnam is entering the IC design market with a race starting from research and human resource training. Associate Professor Dr. Nguyen Thu Thuy - Director of the Department of Higher Education (Ministry of Education and Training) - said: "Currently, the number of IC design human resources is about 5,000 people, the demand increases by 10 - 15% each year. Most of them are design and testing engineers, about 30% of whom have postgraduate degrees. It is expected that in the coming time, the demand for human resources in this industry will increase. To anticipate this trend, preparing high-quality human resources is extremely important. Many training institutions are preparing for this." Meanwhile, Dr. Nguyen Tan Tran Minh Khang - Vice Principal of the University of Information Technology (Ho Chi Minh City National University) - also said that Ho Chi Minh City currently has dozens of 100% foreign-owned FDI companies operating in the field of microchip design from Japan, the US, Taiwan, Korea, Singapore... with a staff of more than 5,000 engineers and experts in microchip design. According to a survey from microchip design enterprises, the demand for human resources in this field in the coming time in Vietnam is about 1,000 engineers/year. The Ho Chi Minh City National University Training Department said that this university is aiming to build a training program for about 1,000 microchip design engineers in 5 years at the undergraduate and postgraduate levels, in order to contribute to increasing human resources for this industry. The training program framework will include intensive, intensive courses and cooperation with businesses. This year, Ho Chi Minh City National University will officially launch training in semiconductor design at three schools: University of Natural Sciences, University of Technology, University of Information Technology (150 students with two groups of subjects for admission A00 and A01). Schools under Da Nang University will enroll nearly 200 students for the semiconductor design training major in 2024, specifically: University of Technology 100 students, University of Technical Education 50 students, Vietnam - Korea University of Information Technology and Communications 40 students. In addition, many schools have also announced enrollment in the semiconductor design major this year such as Hanoi University of Science and Technology, Hanoi University of Science and Technology, Can Tho University, Ho Chi Minh City University of Technology, Ho Chi Minh City University of Technical Education, FPT University, Saigon International University, Phenikaa University, etc.

How does the US want to support Vietnam's semiconductor industry?

Minister Nguyen Chi Dung and Mr. Jensen Huang - Chairman of NVIDIA Corporation - Photo: MPI

The September 2023 Joint Statement on Upgrading Vietnam-US Relations emphasized Vietnam's great potential to become a "key country" in the semiconductor industry. The US affirmed its commitment to increasing support for Vietnam in training and developing high-tech human resources. Over the past 4 months, many steps have been taken to implement the above statement, with specific trips and initiatives. Most recently, in late January 2024, US Under Secretary of State for Energy, Economic Growth and the Environment Jose W. Fernandez visited Vietnam. In a meeting with the press at the end of the visit, Mr. Fernandez said the purpose of the trip was to enhance trade opportunities, clean energy transition, and cooperation on semiconductors and supply chains between the two countries. When asked what support the US can provide to Vietnam in the problem of high-tech labor shortage, Mr. Fernandez said that Vietnam is one of seven countries targeted by the US State Department under the International Technology Security and Innovation (ITSI) Fund. According to Mr. Fernandez, Vietnam is also facing a problem not only in Vietnam but also in many other countries: developing the workforce. "Even in the US, companies are telling us that they need more skilled workers to invest in these countries," Mr. Fernandez raised the issue. Therefore, through the ITSI Fund, the US hopes to support countries like Vietnam in developing a high-tech workforce. "We are receiving requests from US companies and other countries about finding ways to create opportunities in Vietnam," Mr. Fernandez shared. The US Deputy Secretary of State also said that in the next few months, there will be recommendations from the OECD on how the US can support the creation of an international supply chain for semiconductors in Vietnam. At that time, the US will begin making recommendations to Vietnam. In addition to labor, clean energy is also an issue that, according to Mr. Fernandez, Vietnam also needs to pay attention to. He said that a number of semiconductor companies from the US and other countries that want to invest in Vietnam have made commitments to shareholders and customers that they will use renewable energy. 15 companies, including semiconductor businesses, have expressed their desire and commitment to invest at least 8 billion USD in Vietnam if the clean energy system develops./.

tuoitre.vn

Source