Not only has foreign direct investment (FDI) inflows into Vietnam skyrocketed globally, the quality of foreign capital flows into Vietnam has also improved dramatically in recent years.
In particular, the rare earth advantage further urges Vietnam to become a center, an important link in the semiconductor industry supply chain ...
Jumped 108 places, ranked 28th in the world
According to data from the World Bank (WB), FDI capital in Vietnam in 1986 was about 3 million USD, ranking 136/160 countries globally, 9/10 countries in the ASEAN region. However, by 2022, foreign capital in Vietnam increased 6,000 times, to 19 billion USD, ranking 28th globally and 3/10 in the ASEAN bloc. However, according to updated data from the Ministry of Planning and Investment, FDI capital in Vietnam in 2022 reached 22.4 billion USD.
Production of civil aircraft flaps (Boeing) at MHI Aerospace Vietnam Co., Ltd.
PHAM HUNG
According to this ministry, since 1987, the investment and business environment in Vietnam has begun to attract the attention of foreign investors because the investment and business costs in Vietnam at that time were low compared to some countries in the region. In particular, the advantages of a new market and cheap labor have attracted many large investors to Vietnam. To date, 143 countries and territories have invested in Vietnam, especially Vietnam has surpassed Korea, Chile, Denmark... in the global FDI attraction rankings in 2022, ranking in the top 30 countries attracting the most foreign capital in the world.
Not only has the quantity and investment capital increased sharply, the wave of investment from some large countries such as the US, Europe and in the Asian region such as Singapore, Japan and South Korea in the software industry has further confirmed the significant qualitative changes in attracting FDI capital into Vietnam. According to economic experts, foreign capital in Vietnam is tending to focus on industries with high intellectual content such as software industry, electronics and informatics, pharmaceuticals, precision mechanics, etc. In particular, the semiconductor sector has recently emerged with major investors such as Intel, Samsung, etc.
At the 2023 industrial park real estate forum with the theme "Capturing opportunities from new capital flows" organized by Dau Tu Newspaper yesterday, August 24, a representative of the Korea Chamber of Commerce and Industry (Kocham) informed that there are dozens of investment projects from Korea in Vietnam from January to July 2023. In particular, there are projects worth from 700 million to billions of USD. Kocham affirmed that the capital flow from Korea to Vietnam will continue to increase in the coming time, because Vietnam is still considered a potential market by Korean enterprises, especially after the Covid-19 pandemic, the wave of shifting of many foreign investors to Vietnam has become strong, including Korean enterprises. However, because the global economy is in the process of recovery, it may be after another year that FDI capital from Korea to Vietnam will be able to increase sharply.
Also at this forum, Deputy Minister of Planning and Investment Tran Quoc Phuong affirmed that although the world and regional economies have rapid, complex, and unpredictable fluctuations, Vietnam is still a "bright spot" on the FDI attraction map.
"This shows the strong confidence of foreign investors in Vietnam's investment environment," Mr. Phuong emphasized.
Aspirations for a semiconductor industry
Discussing the promotion of attracting investment in industries with high intellectual content, Professor Nguyen Mai, Chairman of the Association of Foreign Investment Enterprises, commented: The series of moves taking place this year is not beyond the prediction that many of the world's leading technology corporations are very interested in Vietnam. To date, Intel has been licensed to invest 1.2 billion USD in semiconductor chips. This is Intel's third factory (in addition to Scotland and Israel) globally and is expected to supply 20% of the world's semiconductor chips by 2030. Samsung and LG have also invested billions of USD, and manufacturers of ship and aircraft components are also present in Vietnam. I assess that the semiconductor equipment manufacturing market in Vietnam will be very exciting in the next few years."
According to Mr. Nguyen Anh Thi, Head of the Management Board of Ho Chi Minh City High-Tech Park, a member of the drafting board of the Strategy for the development of Vietnam's semiconductor chips to 2030, with a vision to 2035, the fact that Korean chip design companies have followed Samsung into Vietnam in recent times shows that the scale of Vietnam's electronics industry is large enough to develop the semiconductor chip industry, first in the design and packaging stages. Infineon Company opened a design office in Hanoi to serve its customer Vinfast, which is an example. The problem is how Vietnam can take advantage of the shift in the value chain and global supply chain that is taking place very strongly and effectively exploit its strengths to participate more deeply in the semiconductor chip industry.
From there, Mr. Nguyen Anh Thi proposed 3 strategic breakthroughs for Vietnam. That is to consolidate the strengths in the stages of designing and packaging semiconductor chips , in which promoting the attraction of foreign direct investment, especially investors playing a key role in the global value chain and supply chain. Second, promoting the formation of domestic enterprises capable of developing electronic products, "made in Vietnam" microchips to serve domestic niche markets, gradually moving towards export. Third, persistently seeking opportunities to participate deeply in the production of microchips, first of all focusing on commonly used microchip manufacturing technologies to gradually absorb and master microchip manufacturing technology.
Thanhnien.vn
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