Thứ Tư, Tháng Sáu 19, 2024
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HomeSorted by levelB2 - Upper IntermediateStars are aligning for Vietnam semiconductor dreams

Stars are aligning for Vietnam semiconductor dreams

[Reading level: B2 – Upper Intermediate]

Around 16 years ago, before Intel set up its HCMC semiconductor plant, Vietnam’s first chip was created.


“Vietnam announced its very first chip, marking its entry into the microchip market” the EE Times, an old American electronics industry magazine, said in an article it published in 2008.


It was an 8-bit microprocessor unit designed by an aspiring group of lecturers and young engineers at the Integrated Circuit Design Research and Education Center (ICDREC) at the Vietnam National University-HCMC (VNU) and launched on January 16, 2008.


After another six years of research ICDREC released its first chip, but it did not attract much interest.


This failure resulted in Vietnamese chips gradually disappearing from the market due to a lack of customers, leaving the country’s plans and strategies for semiconductor self-sufficiency unrealized and forgotten for nearly a decade.


Now the nation’s focus has once again shifted to the semiconductor industry, especially its “Make in Vietnam” campaign, which aims to have chips completely designed and produced by Vietnamese.



Policymakers want the country to secure a spot in the global semiconductor supply chain, which is typically dominated by nations with a per capita income exceeding $11,000, nearly three times Vietnam’s.


The pioneers

In the 2000s, with the establishment of Vietnam’s first hi-tech zone, HCMC sought to exploit the potential of the semiconductor industry.


“The chip is the final product in the [semiconductor] industry,” Assoc. Prof. Dr. Phan Thanh Binh, former president of the Vietnam National University-HCMC, says.


“To guarantee long-term development, Vietnam must invest in and research raw materials production, chip design and production.”


In 2004 the university, in collaboration with its French partners, established the Laboratory for Nanotechnology, now the Institute for Nanotechnology, as a semiconductor clean room facility for research and education purposes.


The ICDREC was set up a year later to research chip design.


At the time VNU did not have enough experts to set up a semiconductor materials research unit, Binh says.


The ICDREC successfully designed its first 32-bit chip in 2010, two years after its first one. This was a huge leap for the industry as most of the popular semiconductors at the time were either 32- or 64-bit.


Four years later it contracted a Taiwanese manufacturing company to produce 150,000 of its 8-bit chips for commercialization. 8-bit chips were not novel at that time but widely used in numerous simple electrical devices, Ngo Duc Hoang, president of the ICDREC, explains.


The market for such chips in Vietnam were worth billions of dollars. But the center’s first attempt at chip commercialization would also be its last.


The product could hardly compete with other chips available in the market that were much cheaper and produced by well-established and reputable global firms.


Since it made little profit from the chip, the center could not pay its engineers as much as foreign chipmakers did. Most key personnel moved to foreign semiconductor firms, leaving the IDCREC unable to launch any new projects.


“Mastering chip designing is a huge achievement, but to create a product that can sell in the market is another story,” Assoc. Prof. Dr. Lam Quang Vinh, head of the science and technology department at the VNU, says.


Though it failed to sell its product, the center was still a pioneer in chip design, Prof. Dang Luong Mo, a special consultant at the ICDRE, points out. “Its products were proof that Vietnamese were fully capable of making their own chips.”


The leap

While Vietnam was busy producing chips for foreign firms, FPT, a leading Vietnamese tech company, was hiring Vietnamese engineers working or studying abroad with the goal of producing “Made in Vietnam” chips.


“We [FPT] specialize in software, but hardware production has also been one of our aspirations,” Tran Dang Hoa, chairman of chipmaking subsidiary FPT Semiconductor and a former senior executive at its software subsidiary, FPT Software, says.


Nguyen Vinh Quang was one of the first engineers to accept Hoa’s offer to join FPT’s chip-making effort in 2014. With his nearly a decade of experience in the semiconductor industry, Quang knew launching a new chip without an established brand name was likely to end in failure.


So FPT chose to outsource in the beginning, specifically designing solutions based on orders from other chipmakers, while simultaneously researching and developing its own products.


After eight years of operating as an outsourcing company, it seized the opportunity provided by the 2022 global chip shortage resulting from supply chain disruptions caused by Covid-19, to establish FPT Semiconductor with Quang as its CEO.


FPT chips arranged in the shape of Vietnam on display at the FPT Techday in October 2023. – Các con chip của FPT xếp thành hình đất nước Việt Nam trưng bày tại FPT Techday tháng 10/2023

The new firm’s first product was a power chip, a microchip that ensures steady power supply in devices.


“The world does not only revolve around advanced two- and three-nanometer processor chips. Power chips may not be difficult to make, but every product needs them.”,” Quang says.


With the boom in Internet of Things (IoT) devices, power chips have been growing increasingly diverse.


But many companies do not have the resources to get large brands to make custom power chips that fit their specific needs. This is the niche market that FPT Semiconductor eyes.


As expected, it quickly received a slew of orders by offering to customize products.


In the last two years the company has introduced three lines of power chips and sold more than 25 million of them.


“Our quality may only be 80-90% of that of the big brands, but we still satisfy the needs of customers at less than half the price,” Quang says with confidence.


The company gets orders from both domestic and international clients that are not large enough in volume terms for renowned brands to take an interest in.



Vietnamese engineers are no longer stopping with power chips but are gradually advancing towards more complex chip models that are higher up the value scale.


In October 2023 Viettel High Tech, state-owned telecom giant Viettel’s research and production unit, announced its first chip, the 5G DFE. It was completely designed by the company’s engineers and can process 1,000 trillion operations per second.


5G chips might be Viettel’s stepping stone to producing various types of chips for technologies that are in demand such as artificial intelligence, 6G and IoT.


The Ministry of Information and Communications forecasts the Vietnamese semiconductor industry to grow to US$20-30 billion in value by 2030. But out of more than 50 chip designing companies in the country, only two are domestic: FPT and Viettel.


For the two other stages of chipmaking, packaging and testing, Vietnam already has facilities set up by major global corporations like Intel and Amkor, but there is currently no semiconductor fabrication facility (fab).


Viettel High Tech and FPT Semiconductor operate under the fabless model, meaning they only design chips and handle their sales without manufacturing them. For instance, FPT’s chip fabrication process is outsourced to South Korea, and its packaging and testing are done in Taiwan.


Government support needed

“Fabless is the right choice for businesses, but on a national scale, we still need fabrication plants if we want to achieve a real breakthrough,” Prof. Dr. Dang Mau Chien, president of the Institute for Nanotechnology, a micro- and nanotechnology research unit under the Vietnam National University-HCMC, warns.


Countries that play key roles in the global semiconductor industry invest in all stages of chipmaking. Moreover, complete dependence on foreign countries for chip fabrication potentially poses a great security threat, especially in the case of microchips used in security and defense.


In Southeast Asia, of the five countries that are capable of both chip design and packaging, only Singapore and Malaysia have semiconductor fabrication facilities, according to consulting firm Ernst & Young (EY).


The chip supply chain in Southeast Asia

Despite pursuing the fabless model, FPT Semiconductor’s management acknowledges that Vietnam’s semiconductor industry needs a comprehensive supply chain to become a spearhead industry.


“We hope that one day our chips will be manufactured domestically to reduce costs,” Quang says.


Making Vietnam capable in all aspects of chipmaking by 2040 is also the long-term goal of policymakers. Fabrication is the most capital-intensive stage in the semiconductor supply chain, requiring billions of dollars for setting up clean rooms, equipment and machinery.


But this is for producing advanced chips used in mobile devices and computers, whereas fabricating simpler chips only requires tens to hundreds of millions of dollars, Chien of the Institute for Nanotechnology says.


He points out that the institute has only invested $8 million in the past 20 years but has managed to produce some basic chips with five to six layers of photomask, an opaque plate used in photolithography, a crucial step in the fabrication process that determines the complexity of the chip.


In comparison, most commonly used chips require 25-35 layers.


“If we [the Institute for Nanotechnology] have more expensive and precise machinery and equipment, we can manufacture more sophisticated chips. As the basic process is the same, engineers who understand the core process can gradually learn to produce more complex products.”


Many engineers involved with chip fabrication at the institute later easily secured good positions at large multinational semiconductor corporations, he adds.


An engineer producing semiconductor devices at the Institute for Nanotechnology’s clean room facility. – Kỹ sư sản xuất thiết bị bán dẫn tại cơ sở phòng sạch của Viện Công nghệ nano.

Binh of the Vietnam National University says the biggest obstacle to developing the chip industry is the market rather than any lack of resources or workforce quality.


If Vietnam focuses only on basic and affordable chips, it will have to compete on price with products from developed countries and ultimately fail, he says, pointing to the example of the ICDREC microprocessor.


He believes four factors are essential to the success of the semiconductor industry: university research, businesses that understand and are willing to invest in the market, support from experienced experts, and, most importantly, the government’s guidance.


“Chip production must be done in large quantities, with factories always running. But the question is, who will consume the products? And are there supportive policies for this emerging industry?”


The buyers of semiconductors are businesses that make electronic products, and there are few Vietnamese electronics manufacturers: 99% of the country’s electronics exports are by foreign companies, according to the General Department of Customs.


Nguyen Phuc Vinh, a semiconductor expert, agrees that the industry needs government support. With Vietnam embarking on digital transformation, there will surely be more demand for electronics, computers and IoT devices, he says. If the government directly orders or prioritizes buying from domestic firms, Vietnamese engineers might just have enough funding to produce chips used in telecom devices, wifi modems and other devices, he suggests. “These devices are directly used to store civilian data, and so Vietnamese chips should be used to ensure cybersecurity.”


Twenty years may not be long enough for Vietnam to develop high-technology products that demand extreme precision like semiconductor chips. But this time the country has multiple factors working in its favor, according to Quang.


To address the global chip shortage, many developed countries with advanced semiconductor industries like the U.S. and Japan are willing to support Vietnam’s entry into the global market, he says.


“People of my generation have been working towards the dream of ‘Make in Vietnam’ chips from the beginning of our careers. Back then the efforts made by a few individuals could not make a difference. Now, it is the coordinated effort of the entire nation.”




semiconductor /ˌsem.i.kənˈdʌk.tɚ/ (n): bán dẫn

announce /əˈnaʊns/ [B1] (v): công bố

make an entry into sth /ˈen.tri/ (v): gia nhập, tham gia vào cái gì

aspiring /əˈspaɪr.ɪŋ/ [C2] (adj): đầy tham vọng

integrate /ˈɪn.t̬ə.ɡreɪt/ [C1] (v): tích hợp

circuit /ˈsɝː.kɪt/ (n): mạch

self-sufficiency /ˌself.səˈfɪʃ.ə (n): tự cung cấp

secure a spot (v): có một chỗ đứng

dominate /ˈdɑː.mə.neɪt/ [B2] (v): thống trị

exceed /ɪkˈsiːd/ [C1] (v): vượt quá

seek to do sth /siːk/ [C2] (v): tìm cách làm gì đó

in collaboration with sb/sth /kəˈlæb.ə.reɪt/ [C1] (pre): kết hợp với, hợp tác với

leap /liːp/ [C2] (n): bước nhảy vọt

commercialization /kəˌmɝː.ʃəl.əˈzeɪ.ʃən/ (n): thương mại hóa

novel /ˈnɑː.vəl/ (adj): mới

well-established /ˌwel ɪˈstæb.lɪʃt/ (adj): lâu đời

reputable /ˈrep.jə.t̬ə.bəl/ [C1] (adj): có uy tín

consultant /kənˈsʌl.tənt/ [B2] (n): chuyên gia tư vấn

aspiration /ˌæs.pəˈreɪ.ʃən/ [C2] (n): nguyện vọng

subsidiary /səbˈsɪ (n): công ty con

executive /ɪɡˈzek.jə.t̬ɪv/ [C1] (n): giám đốc điều hành

outsource /ˈaʊt.sɔːrs/ (v, n): gia công

simultaneously /ˌsaɪ.məlˈteɪ.ni.ə [B2] (adv): đồng thời

seize opportunity /siːz/ (v): nắm bắt cơ hội

shortage /ˈʃɔːr.t̬ɪdʒ/ [B2] (n): sự thiếu hụt

supply chain /səˈplaɪ ˌtʃeɪn/ (n): chuỗi cung ứng

disruption /dɪsˈrʌp.ʃən/ [C1] (n): sự gián đoạn

revolve around sth /rɪˈvɑːlv/ (v): xoay quanh cái gì

boom /buːm/ (n): sự bùng nổ

Internet of Things (IoT) (n): Internet vạn vật

diverse /dɪˈvɝːs/ [B2] (adj): đa dạng

customize /ˈkʌs·təˌmɑɪz/ (v): tùy chỉnh

niche /nɪtʃ/ (n): thị trường ngách

a slew of sth /sluː/ (quant): một lượng lớn cái gì đó

renowned /rɪˈnɑʊnd/ (adj): nổi tiếng

advance towards sth /ədˈvæns/ (v): tiến tới cái gì

value scale (n): quy mô giá trị

telecom /ˈtel.ɪ.kɑːm/ (n): viễn thông

giant /ˈdʒaɪ.ənt/ [C2] (n): gã khổng lồ

trillion /ˈtrɪl.jən/ (n): nghìn tỷ

performance /pɚˈfɔːr.məns/ [B2] (n): hiệu năng

initiate /ɪˈnɪʃ.i.eɪt/ [C2] (v – formal): bắt đầu

roll out (v): triển khai

breakthrough /ˈbreɪk.θruː/ [B2] (n): bước đột phá

surpass /sɚˈpæs/ [C2] (v – formal): vượt qua

take on sth [C1] (v): đảm nhận việc gì

fairly /ˈ [B1] (adv): khá, tương đối

stepping stone /ˈstep.ɪŋ ˌstoʊn/ (n): bước đệm

fabricate /ˈfæb.rɪ.keɪt/ (v): chế tạo

pose a threat [C1] (v): gây ra mối đe dọa

comprehensive /ˌkɑːm.prəˈhen.sɪv/ [C1] (adj): toàn diện

spearhead /ˈspɪr.hed/ (n): mũi nhọn

capital-intensive (adj): sử dụng nhiều vốn

photomask (n): mặt nạ quang

opaque /oʊˈpeɪk/ (adj): mờ đục

plate /pleɪt/ (n): tấm

photolithography (n): quang khắc

core /kɔːr/ [C2] (n): cốt lõi

obstacle /ˈɑːb.stə.kəl/ [C1] (n): trở ngại

ultimately /ˈʌl.tə.mə [C1] (adv): cuối cùng

emerging /ɪˈmɝː.dʒɪŋ/ (adj): mới nổi

customs /ˈkʌs.təmz/ (n): hải quan

embark on sth /ɪmˈbɑːrk/ (v – formal): bắt tay vào việc

cybersecurity /ˌsaɪ.bɚ.səˈkjʊr.ə.t̬i/ (n): an ninh mạng

coordinated effort /koʊˈɔːr.dən.eɪ.t̬ɪd ˈef.ɚt/ (n): nỗ lực chung


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