Vietnam Breaks Ground on Pioneering Semiconductor Plant Amid Tech Sector Push

HANOI – Vietnam commenced construction of its inaugural semiconductor fabrication plant on Friday, advancing its ambitions to transform into a global high-tech manufacturing hub. The facility, located in Hanoi's Hoa Lac High-Tech Park, represents Vietnam's most significant step yet into advanced electronics production.

The military-run Viettel Group, Vietnam's largest telecommunications provider, will operate the plant with trial production scheduled for 2027. Initial operations will focus on optimizing manufacturing processes and achieving semiconductor industry quality standards before scaling production.

Prime Minister Pham Minh Chinh presided over the groundbreaking ceremony, emphasizing semiconductors as "the backbone of modern industry" in his address. The project aligns with Vietnam's national strategy to move beyond assembly work and capture higher-value segments of the electronics supply chain.

Viettel's entry into chip manufacturing leverages Vietnam's existing advantages in electronics assembly, which currently contributes nearly 40% of total exports. The facility will initially produce legacy chips used in telecommunications equipment, industrial machinery, and consumer electronics – segments where Viettel already has market expertise.

Industry analysts note Vietnam's strategic timing coincides with multinational efforts to diversify semiconductor supply chains away from traditional manufacturing centers. The country offers cost advantages and benefits from free trade agreements with both Western and Asian markets.

However, challenges remain in developing specialized talent pools and establishing supporting infrastructure. Viettel plans to address this through partnerships with international semiconductor firms and expanded technical training programs at Vietnamese universities.

The Hanoi plant represents Vietnam's most ambitious domestic technology initiative to date. If successful, it could position Vietnam alongside regional neighbors like Malaysia and Singapore in the semiconductor value chain, while reducing dependence on imported chips currently exceeding $6 billion annually.