Source: Reuters

Taiwanese major chip supplier, TSMC forecasted an annual revenue growth of 10% in the global semiconductor industry, excluding memory chips.

“This is a new golden age of opportunity with AI,” said senior vice-president Cliff Hou, who was speaking at an event in Hsinchu, where the company is headquartered.

In April, TSMC lowered its outlook for the global semiconductor industry excluding memory to a growth rate of around 10% from a previous forecast of more than 10%. World Semiconductor Trade Statistics has forecast growth of 13.1% for the global semiconductor market in 2024.

TSMC has estimated second-quarter sales may rise as much as 30% as it rides a wave of demand for semiconductors used in artificial intelligence applications (AI). Nvidia forecasted its quarterly revenue above estimates and announced a stock split, lifting shares to a record-high territory and impressing investors who have tripled the chipmaker’s market value in the past year on AI optimism.

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Source: Reuters

Samsung, the South Korean manufacturer said it has appointed Young Hyun Jun effective immediately, shifting him from the role as Head of its Future Business Planning Unit. The move is likely aimed at catching up in the market for top-end chips used in artificial intelligence such as high bandwidth memory (HBM) chips, an area where Samsung has fallen behind rivals such as SK Hynix, analysts said.

“This is a preemptive measure to strengthen future competitiveness by renewing the atmosphere internally and externally,” Samsung said in a statement.

Samsung’s market share in DRAM chips used in tech devices reached 45.5% in Q4 2023, according to data provider TrendForce. It lags, however, in the niche but increasingly important HBM chips segment where SK Hynix controls more than 90% of the mainstream HBM3 market. HBM3 is a fourth-generation HBM standard currently the most used for AI chipsets like those made by industry leader Nvidia.

Jun, 63, led Samsung’s memory chip business from 2014 to 2017 after working on the development of DRAM and flash memory chips. He was also the CEO of battery arm Samsung SDI from 2017 to 2022, overseeing a U.S. electric vehicle battery joint venture with automaker Stellantis .

“We expect him to overcome the chip crisis with his management know-how he has accumulated,” Samsung said.

Kye Hyun Kyung, who led the semiconductor division since 2022, will swap into Jun’s prior role as Head of its Future Business Planning Unit. Replacing such a high-ranking position in the middle of the year is unusual given most personnel changes at Samsung typically take place in the beginning of the year, analysts said.

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Source: DIGITimes

Will ASML be affected with the geopolitical uncertainties in the future, given the world’s most advanced high-NA EUV machines is touted to be the ultimate weapon for a technological leapfrog for its customers. 

1. Dan Hutcheson, vice chair of TechInsights, who has covered ASML since the 1970s, when it was still a subsidiary of Philips, and Marc Hijink, the author of Focus – the ASML Way and a reporter at Dutch newspaper NRC, joined DIGITIMES Asia for an insightful talk to address these questions.

Navigating Geopolitical Uncertainties

Although ASML and other semiconductor equipment providers benefit from the demand driven by export controls imposed by the United States to China, geopolitics may have long-lasting implications on the industry as extra capacities and ecosystems are built.

Hutcheson and Hijink see ASML following their customers’ footsteps to decentralise their productions from the Western Pacific corridor to the United States and Europe. Still, the efficiency of its customers’ fab operations may be a concern.

“We’re in a new world where the utilization of the tools is lower,” said Hutcheson, “The problem is, if you can’t find the workers to run the tools or to repair them, keep them running, your wafer fab is useless.”

Hijink observed that Asia will remain an important center for chip production in the future despite the onshoring efforts of various countries and the talent shortage issue since South Korea and Taiwan remain an important part of ASML’s expansion.

ASML’s Monopoly Status Unlikely To Be Challenged

Yet, Hijink cautioned, “ASML’s biggest fear is that the current restrictions on Chinese technology might even stimulate it in the long term and create an even bigger problem.” He pointed out that the less China gets access to these Western lithography tools, the more the Chinese companies are inclined to build their own. “Even though they might not be able to compete with ASML and Nikon now, you see more room for growth and R&D money in the long term.”

Yet, Hutcheson believes no company can challenge ASML lithography monopoly without massive government subsidies.

“Five decades ago, I developed this maxim that the number of unsubsidised competitors a market can sustain is equal to 1/5 the total market size divided by the cost to develop a new generation of technology, and then you subtract 1.5 times that cost,” said Hutcheson. “To attract another competitor in the market, the risk bar must be low enough that there’s enough available R&D to support the development of at least 1.5 more tools than what exists in the market at that time.”

Over those five decades, that maximum is held across 100, or there have been more sub-markets of semiconductor equipment, and that explains the market consolidation of the market from more than 20 semiconductor equipment makers in the 1980s to just a handful right now for lithography, explained Hutcheson.

As a semiconductor industry veteran, Hutcheson witnessed how ASML survived over the past four decades of vicissitudes through better management and technological development. Hijink added that ASML survived because it out-invested in R&D during the low cycles despite being on the brink of bankruptcy several times and cleverly invited its customers TSMC, Intel, and Samsung to invest in it and co-develop the EUV machine.

By getting the investments, ASML managed to get the money to acquire Cymer, the light source company based in San Diego, and establish a strategic alliance with ZEISS, the German lens maker. Those key components and e-beam technology created ASML’s secret sauce of success that competitors cannot copy.

However, repeating such success is getting harder.

“No single company can afford to do it alone, as R&D becomes more and more expensive,” Hutcheson quoted John Chen of Nvidia, who was the first R&D president at TSMC, that,” IC no longer means integrated circuit going forward, IC means industry collaboration.”

Hutcheson estimates that the cost of developing a new EUV tool from scratch would require multiple trillions of dollars, which is equal to the Gross Domestic Product for some countries, and that’s assuming that one gets around all the IP barriers in place. “To some extent, it levels the geopolitical playing field. So maybe EUV should receive the Nobel Peace Prize because no country can attack any other country unless they have the EUV,” quipped Hutcheson.

Can High-NA Machines Help Technology Leapfrog?

As Intel, Samsung, and TSMC are aiming to mass produce 2nm chips in the next few years and advance towards 1.4-1.6 nm, the ASML’s high-NA EUVs are making the headlines of semiconductor industry newspapers.

As always, ASML ships the US$300 million High-NA machines to customers according to the timetable agreed with customers and does the laborious adjusting and error corrections with customers. The media has been describing high-NA EUVs as the key for technology catch-uppers to leapfrog the incumbent. However, Hutcheson delved deeply into the intricacies involved in the complex processes of semiconductor manufacturing beyond lithography.

“There’s a lot of technology issues in the 2nm and 1.4nm era. And we will have to see if they can pull it off and turn it into an advantage,” Hutcheson explained that lithography is not the only factor at stake, there are also issues with the gate-all-around (GAA) structures, due to the leakage problems with that. “There’s also reliability problems, and the epitaxial layer is pretty poor. So really, there are more material and systems engineering problems than lithography problems.”

Though Intel has seemingly bought up all available high-NA machines for the year, TSMC is not in a hurry to apply it to its 1.4-1.6nm process. However, ASML said all of their customers who have bought EUVs are going to upgrade to High-NA EUVs.

“I think that Intel has to do more, try to leapfrog TSMC, which is a daring move, but that’s just one part of Intel’s challenge,” said Hijink. “Their biggest challenge is not the technology, but the fact that they want to do foundry business because they have to create enough wafer footprint or enough scale to be economically viable with huge competitors like Samsung and TSMC. So that adds to the problem of adopting a new technology where they’re not as experienced.”

Hutcheson cautioned that it is too early to judge the outcome of technology competitions. Yet seeing from the history of the semiconductors industry, decades of research, blood, sweat, and tears, and fixing tonnes of errors, plus making the right decisions at the right timing and building deep trust with customers made ASML and TSMC what they are today.

ASML, a blend of European, Asian, and American cultures as the result of acquisitions, can be a great teacher for TSMC, which is just starting to expand its footprints to the US and Europe. With such a close bond between the two, with AI being the main driving force for semiconductor’s future growth, one can be sure there will not be short of fascinating stories in the future.

Editor’s note: For more insights and analysis from Hutcheson and Hijink on the industry, watch DIGITIMES Asia’s new GeoWatch video, ‘Decoding Excellence: ASML’s Evolution Towards Leadership and Beyond.’ Click the link here to access this informative video: https://dgt.ms/geowatch0516

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Semiconductor competition continues after Malaysia announced her mission to be Southeast Asia’s largest integrated circuit design park last April. Now, Vietnam joins the competition for the same crown, with the support from an American semiconductor titan – Marvell Technology Inc.

Marvell Technology, Inc., a titan in data infrastructure semiconductor solutions, accelerated the growth of its workforce and presence in Vietnam in the past year since the company announced plans to expand R&D, engineering and design activities in the country. Marvell committed to 50% growth of its workforce in Vietnam in three years, a target shared by the company during last year’s U.S.-Vietnam Innovation and Investment Summit attended by Marvell Chairman and CEO Matt Murphy. Today, Marvell is ahead of its plans, achieving more than 30% growth in just eight months.

Marvell has also expanded its physical footprint in Vietnam with a new location in Da Nang, adding to its offices in Ho Chi Minh City. The growth of its footprint demonstrates the company’s commitment to creating a world-class semiconductor design hub in the country.

“We are excited with the momentum we’ve gained since we announced our design center plans last year, including our progress in adding top engineering talent to our team and expanding our number of sites,” said Murphy. “Vietnam is rapidly becoming a center of semiconductor innovation and we are committed to being part of that.”

A new Marvell design center facility in Ho Chi Minh City, which is expected to open within the next year, and other Marvell engineering facilities in Vietnam are focused on high-speed data center optical connectivity, storage, and analogue and mixed-signal semiconductor technologies. These are critical to the build-out of accelerated infrastructure to meet the rising performance and power requirements of artificial intelligence (AI) and cloud data centers.

“Marvell has been part of the technology ecosystem in Vietnam for over ten years. The company is committed to attracting the best and brightest engineering talent to its semiconductor design center in Vietnam, and to contributing to the growth of the country’s semiconductor community,” said Dr. Loi Nguyen, Executive Vice President of Cloud Optics at Marvell and a native of Ho Chi Minh City.

Malaysia’s Economy Minister Rafizi Ramli said the government will offer incentives including subsidised office spaces, exemptions on employment passes, relocation services and lower corporate tax rates for foreign venture capital firms, tech entrepreneurs and unicorns – startups reaching a $1 billion valuation – looking to invest in Malaysia.

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“Semiconductors are about chip design; that’s microelectronics. We need strong microelectronics education to compete in the global semiconductor market… In the future, it is important for us to direct human resources toward the Golden Indonesia vision.” he stated after an economic seminar in Jakarta.

Hartarto said that, in the short term, vocational education in the country needs to be improved to produce human resources (HR) who are competent in the field of semiconductors. According to him, vocational schools are well-positioned to produce a highly technical workforce for chip production.

The government has also sought to improve vocational education by issuing regulations in the form of super tax deductions, he added. According to Government Regulation (PP) Number 45 of 2019, the super deduction tax is a tax incentive provided by the government to industries involved in vocational education programs, including research and development activities to produce innovations.

“It has been made easier because there were concerns from corporations regarding audits and others. The Minister of Finance also made the process easier, and it is hoped that it will start to be utilized,” Hartarto said.

He also said that to achieve the Golden Indonesia 2045 vision, Indonesia must continue structural transformation, increase human resources, and develop new engines of growth.

“Especially, the additional engine of growth is in the digitalization sector because Indonesia already has a digital economy framework agreement in ASEAN,” he added.

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TTM Technologies, Inc. a leading global manufacturer of technology solutions including mission systems, radio frequency (“RF”) components and RF microwave/microelectronic assemblies, and quick-turn and technologically advanced printed circuit boards (“PCB”s), opened its first manufacturing plant in Penang, Malaysia with an investment of US$200 million (approximately RM958 million). 

Malaysia is aiming to be Southeast Asia’s Largest Integrated Circuit Design Park, with the goal of being among the top 20 countries in the global startup ecosystem index by 2030. Prime Minister Anwar Ibrahim said the proposed integrated circuit design park was part of Malaysia’s efforts to move beyond backend chip assembly and testing and into high-value front-end design work.

Built on 27 acres in Penang Science Park, TTM’s state-of-the-art facility has highly innovative and automated PCB manufacturing capabilities. This project is the result of the close collaboration between TTM and its customers to address the increasing demand for geographical manufacturing diversity and PCB supply chain resilience.

The plant is customised to support mass production requirements in various commercial end markets, including networking, data centre computing, medical, industrial, and instrumentation.

YAB Tuan Chow Kon Yeow, Chief Minister of Penang said,

“Penang is indeed proud to be the chosen location for TTM to establish its first large-scale, highly automated, and innovative PCB manufacturing plant in Southeast Asia, which also signifies the confidence that foreign investors have placed in Penang. Often lauded for its well-developed industrial ecosystem, Penang has the capacities and capabilities to support the needs of industrial players in next-generation technologies and growth strategies. I am optimistic that TTM will reap a myriad of benefits from its operation in Penang, the Silicon Valley of the East.”

The inauguration of TTM’s Penang plant was marked by the official opening ceremony, presided over by YAB Tuan Chow Kon Yeow, Chief Minister of Penang; Pn. Najihah Abas, Executive Director, Investment Promotion of Malaysian Investment Development Authority (“MIDA”); YBhg. Dato’ Loo Lee Lian, Chief Executive Officer, InvestPenang; Mr. Thomas Edman, President, and Chief Executive Officer, TTM Technologies, Inc.; Mr. Philip Titterton, Executive Vice President and Chief Operating Officer, TTM Technologies, Inc.; senior government officials; and TTM’s senior management.

The establishment of TTM’s Penang plant will facilitate the creation of approximately 1,000 employment opportunities across various categories for local talent by 2025. The expansion will generate substantial opportunities for TTM’s local suppliers and will help cultivate the skills of local technical talent in cutting-edge PCB technology solutions.

TTM anticipates the new plant will generate full run rate revenue of about US$180 million (approximately RM855 million) by 2025. Furthermore, the plant is built to support a Phase 2 expansion that could result in a 25% increase.

Mr. Sikh Shamsul Ibrahim Sikh Abdul Majid, Chief Executive Officer, MIDA emphasised:

“It brings me great pleasure to underscore the significant benefits TTM Technologies’ investment brings to Malaysia’s electrical and electronics (“E&E”) industry, especially within the semiconductor sector. With TTM’s expertise in high-tech solutions and advanced printed circuit boards, Malaysia is now a critical player in the global semiconductor supply chain.

The inauguration of TTM’s cutting-edge facility in Penang not only strengthens the growth and resilience of Malaysia’s E&E industry but also elevates our capabilities in the next generation of PCB manufacturing. This development aligns seamlessly with the strategic objectives outlined in the New Industrial Master Plan (“NIMP”) 2030, focusing on bolstering the semiconductor ecosystem. It opens avenues for skill development and knowledge sharing among local talents, reinforcing Malaysia’s stature on the global stage as a competitive, technologically advanced nation.”

Mr. Thomas Edman, President, and Chief Executive Officer of TTM Technologies, commented:

“The opening of our flagship plant in Penang marks a significant milestone for TTM. We are thrilled to embark on this expansion plan, with a state-of-the-art facility that underscores our commitment to providing our customers with differentiated advanced technology PCB solutions on a global scale. Today, we are proud to celebrate the grand opening of TTM’s first large-scale, highly advanced technology-equipped facility in Southeast Asia. As we step into this new era of innovation and expansion, we are committed to elevating industry standards, meeting customer needs, and propelling TTM’s growth as a new contributor to the Malaysian economy.”

“Penang’s robust industrial eco-system, position as the electrical and electronics hub, strong talent pool, and conducive business environment have made Penang a preferred location for TTM. Due to the outstanding support of the government and the efforts of our employees, TTM is now entering our production ramp only two years after our initial ground-breaking. As TTM builds our presence in Penang, we eagerly anticipate a longstanding relationship and mutually rewarding partnership with the Malaysian government, our customers, and our critical vendors,” concluded Mr. Edman.

Besides contributing to the industry’s needs, TTM is strongly committed to protecting its staff, community, customers, and the environment. To further TTM’s sustainability efforts, the new facility is configured to minimise energy and water consumption and will reduce the carbon footprint by 60% when compared to a traditional PCB plant while still meeting rigorous environmental operational standards.

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Source: Reuters

Malaysia is aiming to turn Kuala Lumpur into a regional digital hub, with the goal of being among the top 20 countries in the global startup ecosystem index by 2030. Prime Minister Anwar Ibrahim said the proposed integrated circuit design park was part of Malaysia’s efforts to move beyond backend chip assembly and testing and into high-value front-end design work.

The country is a major player in the semiconductor industry, accounting for about 13% of global testing and packaging. The park, to be backed by Malaysia’s central Selangor state, will house world-class anchor tenants and collaborate with global companies such as British chipmaker Arm Holdings, Anwar said, without providing further details.

Malaysia’s sovereign wealth Khazanah Nasional will also launch a fund to invest in innovative high-growth Malaysian companies, with an initial allocation of RM1 billion (US$209 million), Anwar told the KL20 Summit event, aimed at launching new policies to support Malaysian start-ups.

Economy Minister Rafizi Ramli said the government will offer incentives including subsidised office spaces, exemptions on employment passes, relocation services and lower corporate tax rates for foreign venture capital firms, tech entrepreneurs and unicorns – startups reaching a $1 billion valuation – looking to invest in Malaysia.

“We want to attract global unicorns to enter Malaysia, so that high-skilled and high-value jobs are created, besides developing a pipeline of future entrepreneurs and senior leaders in tech,” Rafizi said.

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The world leader in semiconductor has a recorded 60% market share by Counterpoint Research. Its close rival Samsung trails behind by 13%. TSMC is known for serving Apple, Nvidia and Qualcomm for iphones, mobile chipsets respectively.

It is also the main supplier for Artificial Intelligence (AI) chips for Nvidia, and Advanced Micro Devices’ (AMD) processors. It even has clients in the Electric Vehicle (EV) sector, working with Tesla and Toyota.

The recent quake reportedly disrupted TSMC’s production as personnel had to evacuate and paused operations. Wall Street Journal quoted the company’s admitting the tremor did cause some machinery to be out of commission, and extreme ultraviolet lithography tools by ASML were unscathed. It added construction work resumed following inspection as at 4 April 2024.

Korea May Take the Spotlight

Bum Ki Son and Brian Tan, analysts at British investment bank Barclays, said in a report:

“We believe this could lead to supply disruptions in the tech supply chain. While we note some companies have reported limited damage and many of the semiconductor fabs should have been designed to withstand strong earthquakes, halts in some operations at high-tech semiconductor fabs could mean disruptions.”

“Some of the high-end chips need 24/7 seamless operations in a vacuum state for a few weeks. Operation halts in Taiwan’s northern industrial areas could mean some high-end chips in production may be spoiled,” they added.

Kim Dae-jong, Professor of Business Administration at Sejong University, cautioned that global chipmakers need to diversify the semiconductor supply chain concentrated in Taiwan to reduce risks. Professor Kim noted,

“Chip companies need to reduce their dependency on Taiwan and diversify their orders to other countries to lower the risk when facing a special crisis like this earthquake. Chip design companies should diversify their non-memory demand to Taiwan, Korea and the U.S. as a way to prepare for crises.”

The professor added the earthquake has also hiked the prices of memory semiconductors, indicating Samsung and SK hynix have reportedly halted memory chip price negotiations with clients because the supply of memory chips will decrease, leading to higher prices.

Another Group With Mixed Opinions

KB Securities advocated the importance of diversifying supply vendors. Kim Dong-won, KB’s analyst said,

“The production disruption in foundries caused by this earthquake is poised to serve as a pivotal moment, shedding light on the industry’s structure. With 69% of global foundry production concentrated in Taiwan, it underscores the risk associated with relying on a single supply chain.

TSMC’s Fab12 plant, where all production personnel evacuated following the earthquake, is encountering operational uncertainty due to damaged water pipes and system errors in certain front-end equipment. As a result, further inspections are necessary to assess the situation. The Korean semiconductor ecosystem is emerging as the optimal alternative for diversifying the memory and foundry supply chain, with long-term benefits expected.”

Lee Jong-hwan, Professor from Department of System Semiconductor Engineering at Sangmyung University commented is too quick to assume TSMC would suffer damage from Taiwan earthquake’s aftermaths. Professor Lee noted, the tremor is not likely to have a substantial impact on the foundry industry’s market share. This is because the foundry industry has long-term contracts with chip design companies, and it is difficult to suddenly change the order and design of the chips to be produced.

“The foundry business needs to supply products tailored to the design requirements of chip design companies. Stable supply is key in maintaining long-term cooperative relationships with customers, so it is difficult for TSMC to lose its customers just because of the earthquake damage,” said Professor Lee.

Nonetheless, he projected the memory semiconductor industry, Samsung and SK could benefit from the earthquake as the industry has a different structure. 

“The memory semiconductor industry may be affected by the earthquake. As production facilities of Micron Technology and Nanya Technology were reported to have suffered damage, rival memory semiconductor companies, Samsung Electronics and SK hynix, are likely to benefit from the market where chip production and supply are more directly connected,” Professor Lee added.

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For the Singapore-based subsidiary of TOPPAN Holdings Inc., a Japanese pioneer in printing technologies and a leading supplier of high quality Flip Chip Ball Grid Array (FC-BGA) substrates, this factory will be the first in Singapore to manufacture high-end FC-BGA substrates used in bleeding edge semiconductor products such as Network Switches and Artificial Intelligence (AI) / Machine Learning (ML) devices.

The production ramp-up is part of TOPPAN’s strategic growth plan to address the increasing global and regional demand for advanced substrates and complements its main production hub in Japan. Research and development (R&D) on advanced substrate technologies to meet the future performance demands of products for such applications also will be conducted at this facility by AST.

With a target to start production by the end of 2026, AST‘s factory will implement state of the art factory automation to produce substrates of highest quality and yield. This factory, with a ~95,000 sqm floor area, will also employ over 200 high-tech engineers and skilled technicians, besides other operators, providing them with an opportunity to learn and lead in the field of FC-BGA substrate manufacturing and development.

TOPPAN will bring their most advanced substrate manufacturing know-how for implementation in AST’s production lines. TOPPAN’s large-body and high-layer-count substrate technology is proven in the products of several well-known large semiconductor companies worldwide. AST’s initial and key hires for FC-BGA substrate manufacturing will undergo intensive training in TOPPAN’s Niigata factories in Japan.

Broadcom Inc., a global technology leader that designs, develops, and supplies a broad range of semiconductor, enterprise software and security solutions, is also supporting the establishment of this world class manufacturing facility in Singapore.

“AST will be our first ever FC-BGA manufacturing facility outside of Japan,” said Mr. Tetsuro Ueki, Senior Managing Executive Officer and Head of TOPPAN’s Electronics Division. “AST will provide high-end FC-BGA substrates that are essential for cutting-edge semiconductor products. By leveraging the design and manufacturing expertise developed at TOPPAN Japan’s Niigata Plant and combining it with state-of-the-art automation technology, AST will achieve the highest quality and production efficiency. We sincerely appreciate the unwavering support from the Singapore government agencies, EDB and JTC, and the invaluable assistance from our esteemed client, Broadcom, which made this project possible,” he added.

Mr Beng Kong Pee, Executive Vice President of the Economic Development Board of Singapore, said, “AST’s new facility is a significant addition to Singapore’s semiconductor ecosystem, which today already hosts a diverse range of manufacturers and suppliers. Singapore continues to strengthen our business-friendly environment, innovation ecosystem and connectivity to the world to remain a critical global node for semiconductors. We are therefore glad to be chosen to host TOPPAN’s first FC-BGA substrate manufacturing facility outside Japan. This is one of Japan’s largest investments overseas in the past decade for a key component in the semiconductor supply chain. EDB remains keen to partner with semiconductor companies globally across the value chain, and we look forward to achieving future milestones with partners like Broadcom and TOPPAN.”

“As TOPPAN’s largest customer for FC-BGA substrates, we welcome the additional capacity AST brings for large body, high layer count substrates,” said Dr. Charlie Kawwas, President of Broadcom’s Semiconductor Solutions Group. “We are also delighted that this factory is getting established in Singapore with a world class talent pool, a vibrant semiconductor ecosystem and outstanding support by the Singapore EDB and government agencies.  Advanced technologies developed at AST will be strategically important for us to differentiating our next generation Networking and AI/ML products and sustaining our market leadership,” he added.

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Vietnam has pledged tax breaks and other perks to semiconductor companies that help to develop the sector in a Southeast Asian country, according to Japan’s Nikkei Asia. The article quoted Vietnamese Minister of Science and Technology Huynh Thanh Dat as saying in an interview that the national plan for chips will include industry grants through a science fund and joint state research with private companies like FPT.

Companies from Nvidia to Samsung are looking to expand their chip businesses in Vietnam, which is slated to receive millions from the US CHIPS and Science Act and already hosts Intel’s biggest global test and assembly factory. Meanwhile, Jose Fernandez, US undersecretary of state for economic growth, energy and the environment, told Nikkei Asia that Vietnam has attracted dozens of companies in the semiconductor field, and several more US players would jump in if the country had enough renewable energy to meet their green goals.

The country needs to strike technology transfer deals with nations dominating the chip sector, Dat said, adding Vietnam will sweeten policies to bring foreign experts into the workforce, which has faced a recent slowdown in foreign work permits. Toward that end, colleges are unveiling semiconductor classes in partnership with employers like Samsung.

Vietnam aims to train 50,000 engineers for the industry by 2030. The country has a strong foundation for science and tech education, but a dearth of advanced skills has limited a broader march up the electronics supply chain.

Fernandez said in an interview while visiting Vietnam that the country is a top target for US CHIPS Act subsidies, which will be a “badge” of confidence. The dollar amount will be based on an assessment expected sometime this month.

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