Vietnam is riding high on the semiconductor wave, with recent government data revealing it is now the third-largest chip exporter to the United States, behind only Malaysia and Taiwan. The semiconductor market in Vietnam is forecast to grow at a CAGR of 6.12% between 2022-2027. As a result, the market size is set to grow by USD 1.66 billion.
The country’s thriving semiconductor industry is propelled by the growing number of smartphone users, increasing investments in the semiconductor sector, and the widespread adoption of IoT technology. With 93.5 million smartphone subscribers and counting, the nation’s appetite for advanced technology is insatiable. This trend can be attributed to rising living standards, the affordability of premium devices, and the government’s strategic focus on 5G development. Vietnam is not only witnessing impressive growth but is also investing in a brighter future. The nation aims to train a high-quality workforce of 50,000 in the semiconductor industry by 2030.
Foreign direct investment (FDI) has been instrumental in Vietnam’s semiconductor industry growth. In 2022, FDI reached a decade-high, further underlining Vietnam’s allure as an investment destination. Companies like Dell, Google, Microsoft, and Apple have shifted parts of their supply chains to Vietnam as proactive measures to diversify their operations and reduce reliance on China amidst rising geopolitical tensions. However, it is crucial to note that Vietnam’s current role in the supply chain is mainly centered on assembly, testing, and packaging, with no domestic semiconductor production. Even the first “Made in Vietnam” chips are manufactured in South Korea.
Despite this limitation, the future looks exceedingly hopeful for Vietnam. Industry giants such as Samsung and Intel are heavily investing in Vietnam, with Samsung inaugurating a USD 220 million R&D center in Hanoi and planning for mass chip production this year. Intel’s projected significant investment increase indicates a forward momentum that is hard to ignore. Additionally, Amkor Technology will open its semiconductor factory in Vietnam, further bolstering the industry’s presence.
