Intel exec lauds Vietnam chip autonomy ambition
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Chip autonomy is an ideal aspiration but it is advisable to avoid setting too big goals in the immediate future, an Intel Products Vietnam executive has told the government.
In 2006, the U.S. chipmaker became the first foreign high-tech investor in Ho Chi Minh City.
“The past 17 years have been a miraculous journey,” Kim Huat Ooi, vice president and general manager of Intel Products Vietnam, said.
“Vietnam has transformed and become much more prosperous. Foreign investors coming here all want to have a foothold and a solid launch pad in Vietnam.”
A number of other major chip manufacturers too have set up plants in Vietnam, forming an open semiconductor supply chain.
Some local technology companies such as FPT and Viettel are also investing in the sector, and hope to export large volumes of “Made in Vietnam” chips.
In April Prime Minister Pham Minh Chinh assigned the Ministry of Planning and Investment with developing a program for electronic chip production.
Vietnam’s advantage
Kim, who has nearly 40 years of experience in the semiconductor field, said when Intel entered Vietnam it had to import most raw materials, but now over 200 local suppliers were working with the plant, helping create a closed process for chip autonomy.
“It is completely right that the Vietnamese Government and companies think big and are ambitious to be self-sufficient in chip sources. Some companies have designed very good microcontrollers for specific applications. Vietnam will have a big opportunity to make more chips.”
Before it set up the plant in Vietnam, Intel was invited by many other countries in the neighborhood. One of the important reasons for Intel choosing to build the plant in Ho Chi Minh City was the stability of the Vietnamese political system.
During the Covid pandemic, many supply chains around the world were broken, but the Intel Vietnam factory was still operating smoothly.
In 2021, its exports surged by 25% from the pre-pandemic period.
Vietnam remained stable even in the most challenging periods.
“It can be seen that in future local supply chains will gradually form and be able to operate independently. As the amount of high-tech investment increases, production costs will decrease, bringing more opportunities for domestic enterprises.
“The past 17 years have been a miraculous journey,”
“The Vietnamese government can use this to accelerate its ambition to produce chips.”
It was right to dream big but it was also necessary to avoid being too ambitious to invest in non-optimal areas and waste money.
Each country should focus on areas where it had an advantage instead of spreading itself too thin. Chip production was resource-intensive.
Local companies also needed to design chips appropriate for their actual capabilities and needs, he said.
Another challenge was human resources since the chip industry required great technical and technological capability to cope with new problems.
“If we look at the current education system in Vietnam, we are seeing that resources are mainly focused on bachelor’s training. To enter the chip industry, more researchers in post-graduate programs are needed.
“To design chips, engineers need a lot of R&D skills.”
However, though investing in human resources required time and money, it was definitely profitable in the long run.
For this, Vietnam needed the right talent, and for this tertiary education should have new curriculums.
Intel and other large foreign enterprises in Vietnam also paid special attention to linking up with universities to improve curriculums and foster talent.
“Seventeen years ago we entered Vietnam and started looking for the first basic workers. Now our plant has continuously sent Vietnamese engineers to the U.S. to work and develop specialized technologies. Initiatives by local talent have been patented in the U.S., making an important contribution to improving the plant’s performance.”
Besides manpower, special attention should be paid to infrastructure and traffic, like dealing with the electricity shortages in some parts in June.
The shortage had been solved, but in the long term investors would need specific plans to ensure reliable power availability.
After the pandemic many neighboring countries had come up with incentives to get major international investors to come and set up supply chains.
Vietnam too should have appropriate policies to retain existing investors and attract new ones.
“The world is changing. Many countries are emerging, attracting large investors back. In Vietnam, we are doing well. Intel wants to continue to invest and contribute to Vietnamese society.”
Questions & Answers
Q.What advice did the Intel executive offer Vietnam regarding its chip autonomy ambitions?
What advice did the Intel executive offer Vietnam regarding its chip autonomy ambitions?
The executive advised Vietnam to avoid setting overly ambitious goals in the immediate future, suggesting they focus on areas where they have an advantage rather than spreading resources too thinly into non-optimal areas.
Q.What is Vietnam's main advantage in the chip manufacturing sector, according to the Intel executive?
What is Vietnam's main advantage in the chip manufacturing sector, according to the Intel executive?
Vietnam's political stability was a key reason Intel chose it, allowing its factory to operate smoothly even during the Covid pandemic. This stability ensures reliable operations for investors.
Q.What are the primary challenges Vietnam faces in developing its chip industry?
What are the primary challenges Vietnam faces in developing its chip industry?
Key challenges include human resources, as the industry needs more post-graduate researchers and R&D skills, and infrastructure, specifically ensuring reliable power availability and improving traffic systems for long-term investment.
Q.How has Intel contributed to developing local talent for Vietnam's chip industry?
How has Intel contributed to developing local talent for Vietnam's chip industry?
Intel has partnered with universities to improve curriculums. It also sends Vietnamese engineers to the U.S. To develop specialised technologies, with some local talent having patented initiatives there.