Vietnam Offers Lucrative Tax Breaks to Semiconductor Firms Amid China-US Chip Conflict – Tech Times
Amid the ongoing chip dispute between China and the US, Vietnam is establishing itself as a major player in the semiconductor sector. To strengthen its place in the global supply chain, Southeast Asian nations are offering semiconductor companies enticing tax breaks and incentives.
The national plan for semiconductor development in Hanoi outlines several initiatives to attract investment and promote industry expansion.
The Minister of Science and Technology, Huynh Thanh Dat, has announced that these measures include tax breaks, industry grants, and collaborative research initiatives with private companies like FPT (via Nikkei Asia).
A woman watches as a man takes a selfie with his mobile phone along the bank of the Saigon river in Ho Chi Minh City on September 8, 2020. (Photo by Nhac NGUYEN / AFP)
However, Vietnam currently faces challenges in its semiconductor industry, including a low localization rate and limited research and development activities.
Despite these obstacles, the country has already attracted the attention of major players like Nvidia and Samsung, with Intel operating its largest global test and assembly factory in Vietnam.
The Vietnamese government is also focused on addressing the shortage of skilled human resources in the semiconductor field. Plans are underway to train 50,000 engineers for the industry by 2030, with partnerships between colleges and companies like Samsung to provide specialized training programs.
The importance of Vietnam’s semiconductor industry has not gone unnoticed by the United States. Jose Fernandez, US Undersecretary of State for Economic Growth, energy, and the Environment, highlighted Vietnam as a top subsidy target under the US CHIPS Act. These subsidies could significantly boost Vietnam’s semiconductor sector and further solidify its position in the global market.
Furthermore, Vietnam’s dedication to the semiconductor industry is evident in its inclusion of the sector in two state programs: the National Fund for Science and Technology Development and the National Product Program. These programs aim to provide support and create competitive products for export from Vietnam.
In a broader context, the semiconductor industry’s growing importance comes amidst the escalating tech rivalry between Washington and Beijing. Companies are seeking alternative manufacturing locations to mitigate risks, making Vietnam an attractive option for investment.
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On a related note, the Association of Southeast Asian Nations (ASEAN) has published a framework for AI governance to promote responsible AI use across member states. Singapore, a leader in AI readiness within ASEAN, has spearheaded efforts in this area, with other member states working to catch up (via CNBC).
Despite the challenges posed by varying levels of digital development within ASEAN, the region is taking steps towards unified AI governance. This includes recommendations for nurturing AI talent, upskilling workforces, and fostering public-private collaboration.
With these developments, Vietnam and ASEAN are positioned to play important roles in the global tech landscape as the semiconductor and AI industries continue to evolve.
Stay posted here at Tech Times.
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