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VIETNAM MOVING DEEPER INTO GLOBAL, REGIONAL SEMICONDUCTOR VALUE CHAINS

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Vietnam is gradually engaging in the global semiconductor manufacturing chain, spanning design, packaging, testing, R&D and specialised chip production.

Semiconductors are not entirely new to Vietnam. The drive among local engineers and researchers to master the technology dates back decades.

In the late 1970s and early 1980s, the Ministry of National Defence’s Z181 Factory produced Vietnam’s first semiconductor components, diodes and transistors for domestic use and export to Eastern Europe. The industry has advanced remarkably since.

Yet Vietnam lacks industrial-scale chip fabrication, and local research and pilot production infrastructure is limited. After design, chips require trial runs on actual silicon to test performance, power, temperature and process issues.

Vietnamese research units and companies design chips. (Photo: VNA)

Local design houses and researchers must outsource this to foreign fabs by project, raising costs, lengthening development cycles and curbing commercialisation. Trial runs cost 30,000–200,000 USD with 12–24 month waits. Assoc. Prof. Dr Tran Cao Vinh, Deputy Director of Vietnam National University, Ho Chi Minh City, said research groups still work in silos, spending heavily and taking much time to build foreign partnerships.

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Research groups still work in silos, spending heavily and taking much time to build foreign partnerships.

Assoc. Prof. Dr Tran Cao Vinh, Deputy Director of Vietnam National University, Ho Chi Minh City

Many design concepts, research findings and promising products from institutes, universities, firms and startups have stalled at pilot production, he pointed out, adding that high tape-out costs, absent coordination and weak support for trial runs, testing and post-fabrication evaluation are blocking Vietnam’s integrated circuit design community.

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Vietnam must fix a core bottleneck: turning designs into physical chips. Authority data shows domestic pilot production demand at about 30,000 chips.

Nguyen Khac Lich, Director-General of the MST’s Authority of ICT Industry and Communications (AITI)

To advance in the global value chain, Nguyen Khac Lich, Director-General of the MST’s Authority of ICT Industry and Communications (AITI), said Vietnam must fix a core bottleneck: turning designs into physical chips.Authority data shows domestic pilot production demand at about 30,000 chips.

Recent policies have sharpened focus. The Politburo’s Resolution No. 57-NQ/TW, dated December 22, 2024, named science, technology, innovation and digital transformation as strategic breakthroughs. On April 30, 2026, the Prime Minister’s Decision No. 21/2026/QD-TTg added “semiconductor chip technology” and “specialised chips” to the strategic technology list, alongside the industry strategy through 2030 with vision to 2050.

On June 26, AITI launched Vietnam’s first national centre to support semiconductor chip prototyping, positioned as a critical new link to move ideas from design and simulation to tested, market-ready chips.

Vietnam’s first national centre to support semiconductor chip prototyping makes debut on June 26, 2026. (Photo: VNA)

At the launch ceremony, Minister of Science and Technology Vu Hai Quan said developing the semiconductor industry is central to the national competitiveness enhancement. On the institutional front, the sector now secures top priority and incentives, and the centre signals the ministry’s strong resolve to turn policy into action.

But a legal framework is only a necessary condition, Quan said, adding that for Vietnam's semiconductor industry to achieve a breakthrough and gain a foothold on the global technology map, experts, research institutes, universities, and enterprises must join forces with the MST to address three key issues, namely workforce quality, support for domestic enterprises, and the development of flagship chip products.

On workforce, beyond foreign training partnerships, universities and institutes need domestic talent roadmaps to build a contingent of engineers strong in both theory and hands-on integrated circuit design.

To integrate local firms deeper in the global semiconductor value chain, the State must create supportive conditions. Alongside foreign investment attraction, support should target enterprises, particularly small and medium-sized ones with core technology but limited capital. The State can fund shared infrastructure, testing centres and key labs while companies must specify their production chain entry points and requirements so policy can match demand, according to the official.

Viable “Make in Vietnam” flagship chips suited to current capabilities will define the industry’s future, the minister went on, adding that candidates include Edge AI chips, smart sensors for high-tech agriculture, and specialised chips for Vietnamese-language data and transaction processing.

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In the initial stage, Vietnam should focus on three product groups with real demand, current capability fit and growth potential.

Nguyen Thi Bich Yen, VSAP Lab Chairwoman

Chairwoman of the Vietnam Semiconductor Advanced Packaging Lab (VSAP Lab) Nguyen Thi Bich Yen, an adviser to the national centre, suggested that in the initial stage, Vietnam should focus on three product groups with real demand, current capability fit and growth potential.

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Edge AI chips or neural processing units

The first comprises Edge AI chips or neural processing units optimised for Vietnamese language and specialised uses, with demand in public administration, health care, education, transport and smart cities.

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Microcontroller units and systems-on-chip for the Internet of Things

The second consists of microcontroller units and systems-on-chip for the Internet of Things with hardware security, using mature technology at reasonable cost while meeting data security and device identity needs in digital infrastructure.

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Chiplets combined with advanced packaging

The third is chiplets combined with advanced packaging, breaking a large complex chip into smaller functional chiplets, each designed to perform a specific function.

No single entity can build a strong semiconductor industry; it demands coordinated action from the State, businesses, research institutes, universities, domestic and foreign experts, international partners, investors and startups.

Quan said the MST will act as a strong bridge, ensuring research projects proceed fairly, transparently and effectively under the semiconductor industry development strategy through 2030 with vision to 2050 to rank Vietnam among the world’s leading chip producers by the middle of this century./.