According to a report by the US Semiconductor Industry Association (SIA), the world semiconductor market will achieve double-digit growth in the coming years with revenue of up to 1,000 billion USD by 2030. It is forecast that by 2024, Viet Nam's semiconductor industry will exceed 6.16 billion USD, turning Viet Nam into one of the important elements in the global semiconductor supply chain. In the context of more and more opportunities opening up for Viet Nam after upgrading bilateral relations with major countries, along with the current trend of shifting the global semiconductor supply chain, the investment attraction and development of the semiconductor industry play important roles in creating a new impetus for socio-economic development, freeing Viet Nam in general and Da Nang in particular from the "middle income trap".
As one of five centrally governed cities, Da Nang is a young, dynamic and modern city, acting as a growth engine for the socio-economic development of the Central region and Central Highlands. Da Nang has many important advantages to become a potential new center for IC & semiconductor investment in Viet Nam in the coming time, including strategic geographical location, convenient connection with provinces and cities in the country and region; synchronously built information technology and transportation infrastructure; young, abundant and high quality IT and electronics human resources with competitive salaries compared to other localities in Viet Nam; good quality of life to attract leading industry experts; and the consistent company and support for enterprises from the city government.
The Decision No. 1287/QD-TTg dated November 2, 2023 of the Prime Minister approving Da Nang City Planning for the period 2021-2030, with a vision to 2050, determines Da Nang to becoming one of the country's high-tech industrial and supporting industry centers, including microelectronics technology, semiconductor and integrated circuit technology. Therefore, Da Nang has been focusing on building a strategy to develop the semiconductor industry concentrating on chip and IC design, and gradually developing the testing and packaging of semiconductor chips. In the coming time, the city will focus on main solutions to promote attraction of the semiconductor industry as follows:
1. Prepare for human resources
Human resources are one of the core and key issues to attract investors in high-tech industries. Da Nang is one of three human resource training centers in the field of IC & semiconductor in Viet Nam. The city currently has strengths in the design stage in the semiconductor industry value chain, with 250 microchip and electronic enterprises and 10,500 employees, including 550 IC design engineers. The annual goal is to have about 1,000 engineers graduating from prestigious universities in the city. A young, qualified, professional, and diligent workforce is one of the critical factors that attract investors to Da Nang. Labor costs in Da Nang are also lower than other major cities in Viet Nam. Cooperation between educational institutions and enterprises is constantly promoted to improve the quality and quantity of human resources.
To promptly prepare sufficient human resources for the semiconductor market, the city will focus on intensive training, tightly collaborating with enterprises in training programs to closely follow the needs of employers. Currently, the city is focusing on researching mechanisms and policies to attract international human resources; improve the quality of lecturers in semiconductor industry training, and simultaneously call for senior personnel in enterprises to participate in teaching; forming a network of experts and partners to exchange experience through conferences, seminars and specialized events; deploying programs to support universities and training facilities in accessing technologies to invest in building and operating infrastructure for the development of semiconductor chips and integrated circuits.
The Seminar on human resource development for semiconductor industry in Da Nang city 2023 organized by Da Nang People's Committee in October 2023
Workshop on developing high-quality human resources for the semiconductor industry in Viet Nam higher education institutions organized by the Ministry of Education and Training in Da Nang in October 2023
Within the framework of the city leaders’ delegation to the United States in November 2023, under the witness of Vietnamese President Vo Van Thuong, the People's Committee of Da Nang City and Synopsys Inc. exchanged the Memorandum of Understanding in coordinating in the implementation of training programs, human resource development and expanding the cooperation network in the semiconductor industry.
Memorandum of Understanding signing ceremony between Da Nang People's Committee and Synopsys (Source: baoquocte.vn)
2. Formulate incentive policies and develop technology
In addition, Da Nang is currently focusing on researching and proposing the Central Government’s approval of specific and outstanding policies in the city, such as tax incentives, land, and financial assistance... in order to promote investment in developing the semiconductor industry; foster start-ups’ involvement in the design field; encourage large enterprises in the city to enter into joint ventures with foreign partners to fabricate, test and package microchips; formulate policies to prioritize the use of IC and semiconductor products designed and manufactured by Vietnamese enterprises; promote incentive policies to attract Vietnamese experts and people from overseas to return home for working…
The City People's Committee has established 02 teams to implement the Scheme "Development of Semiconductor Chips and Microchips of Da Nang City", including the Task Force and the Consulting Group. The Task Force, headed by Mr. Ho Ky Minh - the Permanent Vice Chairman of the City People's Committee, conducts research, formulates and coordinates in the implementation of the Scheme, advises and proposes policies for IC and semiconductor development in Da Nang city. The Consulting Group, headed by Mr. Le Quang Nam - the Vice Chairman of the City People's Committee, provides consultancy, criticism and suggestions on the Scheme’s contents and related policies for developing IC and semiconductors in the city.
The People's Committee of Da Nang city has also established the Da Nang IC Semiconductor and Artificial Intelligence Center for Research and Training under Decision No. 2941/QD-UBND dated 29/12/2023. The Center performs the function of conducting research and design training activities in microchips, semiconductors and artificial intelligence development; technology transfer, international cooperation; mobilising resources; linking and cooperating with domestic and foreign partners to promote research, training, IC and semiconductor design and artificial intelligence development in the city in accordance with the law.
Da Nang is one of 3 cities in Viet Nam participating in Vietnam's Semiconductor Innovation Network (launching on October 29, 2023). The operation of the Vietnam Semiconductor Innovation Network will gradually realize the development orientation of the semiconductor industry in Vietnam, promoting Vietnam being a reliable partner in the regional and worldwide semiconductor ecosystem, thereby enhancing Vietnam's position in the global value chain and modernizing the economy.
3. Prepare Infrastructure ready for the semiconductor industry
Da Nang has the best information technology infrastructure in Central Vietnam. Both international marine optical fiber cable routes (SEMEWE3 and APG) go through the city, ensuring smooth connection with stable and high-capacity transmission lines. Da Nang has 4G coverage throughout the city, and 5G is being deployed on a trial basis.
The city has 03 information technology parks under operation with more than 9,000 employees. Da Nang Hi-tech Park is one of the three national hi-tech parks and the only one in Central Vietnam. Da Nang Information Technology Park is one of the four major concentrated IT parks in Viet Nam. With convenient locations for transportation and synchronously invested infrastructure, these parks are ready to satisfy enterprises’ requirements for establishing offices, R&D centers, as well as high-technology incubators. Da Nang Software Park No.2 is expected to operate in 2024, accommodating 6,000 employees. Additionally, 03 new software parks are expected to commence construction in 2024. Furthermore, Da Nang also focuses on investing in infrastructure construction and technology development; especially the power network that meets the requirements of semiconductor fabrication plants (preferably 28nm to 128nm technology).
4. Strengthen investment promotion and attraction
The city focuses on calling for foreign semiconductor enterprises to invest in establishing branches and building factories in Da Nang; encouraging corporations already operating in the country to expand investment and recruit semiconductor industry engineers in the city; researching for providing incentive packages to and support for semiconductor businesses in factory construction and personnel recruitment. Currently, the city is building a plan to reach out to a number of strategic investors and businesses in the field of semiconductor industry in some key markets such as the U.S.A, Korea, Taiwan, and Japan to strengthen investment attraction.
Catching the wave of semiconductor chip investment following Viet Nam and the United States upgrading their comprehensive strategic partnership, Da Nang city proactively organized a business delegation to the United States to promote investment in the field in November 2023. The city leaders have contacted and worked directly with leading chip and semiconductor companies and corporations (Synopsys, Qovor, Intel, Marvell, Nvidia etc...) to discuss opportunities and programs for cooperation and investment in this field in Da Nang.
The delegation of Da Nang city worked with Nvidia
The delegation of Da Nang city worked with Intel Corporation
The city has been promoting the organization of delegations investigating countries with leading semiconductor industry development in the region and the world such as Korea, Taiwan (China), the United States...; learning models of training and developing semiconductor human resources, working and exchanging on cooperation with universities and training facilities in the semiconductor IC industry; encouraging and sponsoring IC research and development projects; commercializing research projects; as well as encouraging and sponsoring IC research and development projects.
The state of Oregon (USA) desired to support Da Nang city in the semiconductor field
Thuringen state (Germany) is Europe's leading semiconductor center, and the Premier of Thuringen state wanted to promote investment cooperation with Da Nang city in the field of semiconductor.
With the urgent preparation of Da Nang city in terms of mechanisms, policies, and human resources, in the coming time, the city expects to attract many semiconductor corporations and companies to invest and conduct business in Da Nang, in order to gradually and successfully build Da Nang into a potential investment destination and a new semiconductor industry center in Viet Nam./.
