Developing the semiconductor industry is a priority of the government which strives for deeper integration into the global value chain and participation in important links of the semiconductors production process, from designing and assembling to packaging and testing.

On September 19, the National Innovation Center (NIC) signed an MOU with Cadence Design Systems, Inc on activities to help promote designing and developing semiconductor chips in Vietnam.

NIC has joined hands with the University of Arizona to develop human resources for the semiconductor industry. The Ministry of Education and Training (MOET) has signed an MOU with Intel on developing human resources for high technologies.

In mid-September, Hana Micron Vina, a South Korean invested enterprise, inaugurated the Hana Micron Vina 2 factory, the first semiconductor manufacturing project in the north. The company plans to raise total investment capital to over $1 billion in Vietnam.

Prior to that, during her working visit to Vietnam last July, US Secretary of the Treasury Janet Yellen stressed that Vietnam is an increasingly important partner for the US, and that Vietnam is an important intersection of the global semiconductor supply chain.

Dragon Capital said the upgrading of the Vietnam-US relationship into a comprehensive strategic partnership will accelerate the re-establishment of the high-technology supply chain such as the semiconductor industry.

Its experts believe that enterprises like FPT and Duc Giang Chemicals will be expected to receive special benefits from the semiconductor industry development strategy.

Order for 25 million chips

FPT has announced cooperation with LandingAI, which pioneered computer vision and AI in the US. The agreement aims at speeding up the process of training in AI in its education system – FPT Education.

In 2022, FPT established FPT Semiconductor for designing and manufacturing microchips. Its research and development period has finished and the mass production of source chips has begun. The group plans to provide 25 million chips to global markets in 2024-2025. 

Meanwhile, FPT University has announced the establishment of the Faculty of Semiconductor Circuits, aiming to provide high-quality human resources lacking in Vietnam. The faculty plans to enroll the first students in 2024.

FPT President Truong Gia Binh has proposed that the US government call on large corporations such as Boeing, AT&T, Qualcomm, Intel and Ford to make investments in Vietnam. He also asked the government of Vietnam to create favorable conditions to produce 30,000-50,000 workers for the industry.

FPT is one of the leading ICT (information and communications technology) economic groups in Vietnam with capitalization of VND125 trillion, and among top 10 companies with highest values on the bourse.

FPT reported record high net profit of VND5.31 trillion last year and VND3 trillion in the first half 2023. Its total assets have reached over VND60 trillion.

Materials for semiconductors

Duc Giang Chemicals is also believed to have benefits if Vietnam gathers develops the semiconductor industry. It is the country’s largest producer of yellow phosphorus (P4), the major material for electronic circuits and semiconductors.

It is estimated that 40 percent of total revenue of the company would come from yellow phosphorous production, and the remaining from Phosphoric Acid for food, Extracted Phosphoric Acid - WPA 50 percent, DAP fertilizer, and other chemicals.

The chemicals company now has total production capacity of 60,000 tons of yellow phosphorous a year. It took over Phosphorus 6 joint stock company, which owns one yellow phosphorous factory with the capacity of 9,800 tons per annum in Lao Cai province. 

According to DSC Securities, the deal would help increase the output of yellow phosphorous by 18 percent and eliminate a rival in the market.

Duc Giang said it will focus on boosting the export of electronic-grade phosphoric acid. This is the highest grade used to produce electronic circuits, semiconductors and LCD screens. The company opened a production line with a capacity of 30,000 tons per annum in 2022.

On September 20, FPT shares traded at VND98,500 per share, while DGC shares were at VND95,900.