Leveraging the advantages in the global semiconductor chip supply chain

So, in this game, what advantages does Vietnam have and what do we need to do to get rich from the digital economy ?

Electronic components manufacturing at Channel Well Technology Vietnam Co., Ltd., Quang Minh Industrial Park (Quang Minh commune).

Where is Vietnam on the microchip manufacturing map?

Analyzing Vietnam's opportunities in the global semiconductor supply map, Associate Professor Dr. Mai Anh Tuan (University of Technology, Vietnam National University , Hanoi ) said that our strengths come from the foundation of the electronics assembly industry with an abundant workforce. Vietnam has been the capital of electronics manufacturing for over a decade with the presence of global corporations such as Samsung (producing over 50% of smartphones in Vietnam), followed by LG, then Foxconn (Apple's partner), helping us have a solid technology foundation.

In addition, the presence of Intel with a chip assembly and testing factory worth 1.5 billion USD over the past 15 years has proven that Vietnam has full capacity for complex stages of the semiconductor industry.

Along with that is a large workforce and a team of engineers working with discipline in a high-tech production environment. In addition, Vietnam is considered to have a young, abundant human resource, capable of learning and adapting quickly to new technology (golden population).

One factor that cannot be ignored is that Vietnam has significantly competitive costs compared to other semiconductor centers such as Taiwan (China), South Korea or Singapore and is especially suitable for labor-intensive stages such as packaging and testing.

According to Associate Professor Dr. Mai Anh Tuan, another important point is that Vietnam maintains neutrality in the geopolitical context, especially the trade and technology tensions between the US and China, forcing global corporations to diversify their supply chains to minimize risks. In that context, Vietnam with its political stability and balanced foreign policy becomes the ideal choice for this strategy.

In fact, the Vietnamese Government has made a strong commitment and has been implementing attractive investment policies. In particular, the strategic priority has identified the semiconductor industry as a national key industry. The State has issued specific development strategies and the highest incentive mechanisms for semiconductor investment (exemption and reduction of corporate income tax, land rent). In addition, the Government is also promoting investment in infrastructure development with a system of seaports and airports; simplifying administrative procedures, customs, etc.

Investing in chip production linked to domestic demand

According to experts, domestic enterprises should focus on designing and manufacturing chips in practical areas that are related to domestic needs.

According to Colonel, Dr. Le Hai Trieu, Director of the Institute of Professional Electronic Engineering (Department of Security Industry, Ministry of Public Security), businesses should not focus on super advanced chips because the investment cost is too high, up to tens of billions of USD. We should invest in chip production to serve simple applications, such as IoT (Internet of Things), automobiles, or industrial equipment. In addition, businesses should invest in making 40nm chips to serve the making of citizen identification cards and passports, which are widely used, accounting for 95% of the world market share and will continue to be used for at least 20-25 years.

Sharing the same view, Associate Professor, Dr. Thai Truyen Dai Chan, member of the Scientific Council of CT Group, analyzed that Vietnamese enterprises can focus on investing in low and medium power microchips for IoT, sensors, smart devices and 6G infrastructure. Enterprises can focus on investing in making security circuits, serving e-government, defense, UAV (unmanned aerial vehicle) and smart identification; or can focus on specialized circuits for smart transportation, AI at the edge and defense applications. Enterprises can also invest in energy and electric vehicle microchips, such as battery management, motor control, energy conversion, in line with the green industrial development orientation.

With the experience of a leader who has successfully designed ADC semiconductor chips and just signed an agreement to export 5,000 UAVs to Korea, Chairman of the Board of Directors of CT Group Tran Kim Chung said that the market needs about 10 types of chips to serve the digital transformation process, such as: Semiconductor chips serving the digital transformation process in phase 2 and phase 3; MCU chips (microprocessor chips); AI chips at the edge; telecommunications and remote sensing chips; chips of all kinds specialized in satellites... However, to develop these types of chips is not a matter of a day or two, it can take up to two years for the stages of research, design, photolithography, packaging, testing...

Obviously, from its natural advantages, Vietnam has every opportunity to invest in supplying semiconductor chips. Investment in semiconductors needs to be self-sufficient in production and needs a realistic, selective roadmap.

The National Assembly has just passed the Law on Digital Technology Industry, which has a separate chapter regulating the development of the semiconductor industry, especially the production and design of semiconductor chips, raw materials, materials, and equipment. Semiconductor enterprises are entitled to special investment incentives, support for training costs, research and development, and import of used equipment. Supporting enterprises in the semiconductor supply chain are also supported according to regulations.

Hopefully, these new regulations will be a boost for domestic enterprises to increase investment and attract resources, soon making Vietnam a link in the global supply chain, contributing to promoting the development of the domestic digital economy.

Source: https://hanoimoi.vn/phat-huy-loi-the-trong-chuoi-cung-ung-chip-ban-dan-toan-cau-715333.html