Vietnam approves US$500 million plan for country’s first wafer fab

Business news | March 4, 2025

By Peter Clarke

The Vietnamese government has approved a plan worth 12.8 trillion Vietnamese Dong (about US$500 million) to build a wafer fab, according to Vietnamnet, an online newspaper affiliated with the Ministry of Information and Communications.

This would be the country’s first wafer fab. Pham Minh Chinh, the Prime Minister will personally examine the selection of private companies to partner with the government on this initiative, the report said.

The formation of a consortium around an inward investor skilled in the art of chipmaking is the usual route for providing patent protection and developing domestic chip technology. It is a path being pursued by India but has proved lengthy and frustrating process.

Government funding in this project can be up to 12.8 trillion VND with the intention of supporting national defense, high-tech industry and research needs, the report said.

Vietnam’s Prime Minister has recently signed a semiconductor development strategy to 2030 as part of a longer-term Vision 2050, strategy. Under the semiconductor strategy Vietnam is prepared to provide 30 percent direct government funding up to a maximum of 10 trillion VND (about US$400 million) if completed before December 31, 2030, Vietnamnet said. It appears the wafer fab project is an exception with higher government spending

Tax incentives are also on offer to allow chip companies to retain 20 percent of taxable income as long as the money is used for reinvestment in Vietnam’s semiconductor ecosystem.

Vietnam has two significant technology firms with activities in the semiconductor sector – Viettel and FPT. Viettel has designed a 5G chipset. FPT Corp. is Vietnam’s largest technology and IT services group and reported revenue exceeding US$1 billion in 2023.