Investing
Localities report big business with foreign-led enterprises
In early January, the northern province of Bac Ninh granted 18 registration certificates totalling $1.8 billion, including $1.67 billion of foreign direct investment (FDI).
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| Vital project approvals are often taking place at a quicker speed than in previous years, photo: Samsung |
Among the major pieces of funding licensed is $1.2 billion by Samsung Display Vietnam. The licence followed an MoU signed between the company and Bac Ninh authorities in September 2024.
Other noteworthy projects combine the $125 million added-capital scheme by Cooler Master Vietnam and $89.5 million of adjusted capital from THK Manufacturing Vietnam Co., Ltd.
“Granting the investment certificates on the first days of the new year was the province’s commitment to aid businesses,” Nguyen Anh Tuan, Secretary of Bac Ninh Party Committee, said at the signing ceremony.
These projects were licensed just a short time after proposals were made. In addition to the Samsung example, Taiwan-headquartered Cooler Master, a computer hardware giant, decided to increase funding during the construction progress of the first phase.
“These moves show that investors see the opportunities, improvements, and trust in the business environment here,” Tuan said.
Meanwhile, on the first days of the Lunar New Year, Binh Duong People’s Committee granted approval to seven projects worth nearly $1 billion, including two new ventures, three added-capital ones, and two industrial park (IP) infrastructure initiatives: a Vietnam-Singapore IP undertaking worth $341.2 million, and an urban project worth $471 million. Thanks to these, South Korea led the pack in terms of registered capital with over $1.25 billion, accounting for more than 28.9 per cent of the country’s total and 13.4 times higher than the same period last year.
The biggest recipients of registered capital in Vietnam were Bac Ninh province with $1.39 billion (32.2 per cent), a six-fold rise on-year and simultaneously excessing the province’s goal for the whole year; Dong Nai province with nearly $959 million, a 3.4-fold increase.
The localities in the north such as Thai Nguyen and Haiphong also report the increase of the FDI capital influx to the country.
The statistical visualisation platform Seasia Stats has ranked Vietnam among the top 15 economies in Asia, with projected economic output reaching some $506 billion in 2025.
Seasia highlighted Vietnam’s rapid development, driven by explosive manufacturing growth and foreign investment.
“While China remains the continent’s largest economy, followed by Japan and India, Vietnam has distinguished itself as a rising economic force in Southeast Asia. The country, positioned 12th in the regional ranking, is projected to achieve 7 per cent economic growth in 2024, a remarkable rate that makes it among the fastest-growing economies in the region and the world,” Seasia noted in its report.
In particular, localities also make an effort to create breakthroughs for foreign investment attraction this year. Hai Duong is an example. The province strives to engage $1 billion or more in FDI. If the $1 billion mark is achieved, overseas funding attraction to the province in 2025 will increase by 39.3 per cent compared to 2024.
“To achieve the set goals, Hai Duong will draw in large-scale, high-tech projects, especially in the processing, manufacturing, electronics, semiconductor, AI, and hydrogen industries,” said Le Anh Dung, director of Hai Duong Department of Planning and Investment.
In the first quarter of 2025, the provincial IP management authorities will shorten the time for granting registration certificates to eight days, a reduction of seven days compared to regulations, except for cases that must be reported to competent authorities; the time for handling adjustments to certificates will be eight days, a reduction of two days compared to regulations, Dung added.
The province will reduce to 15 days for granting new construction permits and granting repair and renovation permits, and reduce to 17 days for appraisal of feasibility study reports, or adjustment of feasibility study reports.
IPs in the province prioritise manufacturing industries in the fields of semiconductor integrated circuit industry, design technology, manufacturing of components, integrated electronic circuits, flexible electronics, semiconductor materials, and high-tech product manufacturing projects.
“To show the determination to complete the foreign funding goal, the IP Management Board, for the first year, assigns targets to each IP infrastructure investors, which focus on Lai Cach, Gia Loc, and expansions to Dai An and Phuc Dien,” Dung said.
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Foreign direct investment into Vietnam rose by 2 per cent on-year to $1.51 billion in January. Meanwhile, planned foreign funding jumped by 48.6 per cent from a year earlier, to $4.33 billion. Foreign financiers injected capital into 16 out of 21 economic sectors, with processing and manufacturing leading the way, accounting for 71.3 per cent of total registered capital, equivalent to $3.09 billion. Real estate followed, attracting $1.09 billion, representing 23.5 per cent of the total. In January, Vietnam received investments from 55 countries and territories. South Korea was the largest backer with $1.25 billion, closely followed by Singapore with $1.24 billion. Source: Ministry of Planning and Investment |
The Ho Chi Minh City Real Estate Association (HoREA) has proposed a pilot mechanism that would allow businesses to invest in and construct worker housing within industrial parks.
In a document submitted to the Prime Minister, contributing feedback on a draft pilot policy aimed at boosting social housing development, HoREA suggested that businesses, cooperatives, and cooperative unions operating within industrial parks be permitted to build accommodation for their workers. It also called for allowing companies to rent housing outside industrial parks for the same purpose.
HoREA emphasized that all costs related to building or renting worker housing should be recognized as legitimate business expenses and be included in the enterprise’s operating costs.
The association further recommended expanding the policy framework to allow companies within industrial parks to lease social housing or worker accommodation built by third-party developers outside the park premises.
According to Mr. Lê Hoàng Châu, Chairman of HoREA, the current Housing Law (2023) only allows companies to rent worker housing inside industrial parks, without clearly defining whether they can rent social housing outside the parks or construct such housing themselves.
With worker housing demand at industrial parks far exceeding supply, HoREA pointed out that current social housing and dormitory offerings are inadequate. Meanwhile, commercial housing remains out of reach for most workers due to high prices. Therefore, the association urges the government to introduce policies enabling manufacturing businesses—despite not operating in real estate—to develop their own accommodation solutions for employees.
HoREA underscored that such policies would create a strong legal foundation, empowering enterprises and cooperatives to proactively resolve housing issues for workers. If allowed to construct their own housing, companies could ensure homes go to those in need, boosting employee retention, improving living standards, and supporting sustainable growth in industrial zones.
The association also proposed financial support mechanisms, including tax incentives, access to preferential loans, or government-matching support, to reduce the financial burden on companies participating in worker housing development.
Previously, many businesses had expressed a desire to buy land, build housing, and offer installment-based homeownership plans to workers, whereby employees would pay monthly through salary deductions. While this model helps workers secure long-term housing, legal procedures remain a major hurdle.
Providing accommodation has increasingly become part of corporate strategies to retain labor, alongside other employee welfare policies. For example, Nissei Electric Vietnam (Linh Trung 1 Export Processing Zone, Thu Duc City) has built a dormitory complex with 285 shared rooms, housing up to 2,280 workers. Eternal Prowess Vietnam (District 12) and Thien Phat Company (Linh Trung 2 EPZ) have also invested in on-site worker housing. Thien Phat’s project includes 368 units (35m² each), rented at VND 2.2 million/month, with 80% of the units for families and 20% for shared accommodations.
As of Q2 2024, Ho Chi Minh City has 18 industrial parks with around 1,700 businesses employing approximately 320,000 workers. Citywide, over 1.3 million people are employed in factories. However, there are only 16 official worker housing complexes, accommodating about 22,000 people. The majority of workers rely on rented rooms or stay with acquaintances—often sharing 12m² rooms among 2–3 people, which consumes 15–20% of their monthly income.
From 2021 to the present, Ho Chi Minh City has completed six social housing projects with 2,700 units and is building four more with 3,000 units. By April 30, the city aims to resolve legal hurdles and break ground on 5–6 additional social housing projects, totaling around 8,000 units.
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According to Statista Market Insights, the Vietnamese semiconductor market is forecast to see healthy growth with a compound annual growth rate of 9.62 per cent between 2024 and 2027, reaching a market volume of $26.20 billion.
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| Le Quan, Senior lecturer Faculty of Engineering Fulbright University Vietnam |
Vietnam also boasts over 30 foreign-led companies in integrated circuit (IC) design, including established players like Renesas, Synopsys, and Cadence alongside innovative startups like Ampere, ADTechnology, Inphi, FingerVina, Dolphin Technology. The sector also encompasses numerous smaller firms with around 100 or fewer employees.
By 2040, Vietnam is poised to become a crucial player in the global semiconductor ecosystem, encompassing all aspects of the industry, from design and manufacturing to assembly, test, and packaging (ATP) and equipment fabrication.
The strategy emphasises the importance of fostering a skilled workforce. Vietnam boasts a strong talent pool in the semiconductor industry, with 50,000 design engineers, 200,000 electronics engineers, 500,000 technical workers, and one million software engineers. To further enhance this workforce, the strategy aims to transition up to 30,000 personnel from the existing pool of 350,000 IT and telecommunications engineers.
The global semiconductor packaging landscape is undergoing a rapid transformation, driven by a surge in new facilities across Asia. The wave of semiconductor investment in Vietnam and the industry’s demand for personnel have driven educational institutions, from top universities to vocational colleges, to launch training programmes related to semiconductors.
Last year, major universities such as Hanoi University of Science and Technology, University of IT – Vietnam National University Ho Chi Minh, and the University of Engineering and Technology announced engineering programmes specialising in semiconductors. Younger universities like FPT and Phenikaa are also making significant investments in this area, not only in training initiatives but also in facilities and equipment.
However, to truly understand the current landscape of semiconductor training in Vietnam, it is essential to look at the regulations and current state of training schemes in this field from 2024 backward.
Firstly, the high costs associated with establishing chip fabrication facilities make it an impractical investment for Vietnam. The country’s resources would be better allocated towards sectors that promise more immediate returns, such as ATP and IC design. Advanced packaging technologies represent a feasible and profitable entry point in the global semiconductor value chain, aligning with Vietnam’s strengths in low-cost, adaptable labour.
Vietnam should focus on drawing overseas funding into ATP operations, leveraging its lower labour costs to attract foreign companies. The availability of a high-quality but affordable workforce makes Vietnam an attractive destination for packaging, testing, and assembly processes. Prioritising such investment with advanced packaging capabilities will allow Vietnam to build a competitive advantage in this sector.
Meanwhile, the IC design segment represents a high-value opportunity with significant global demand. To capitalise on this, Vietnam should proactively seek partnerships and outsourced projects from international IC design firms. Engaging Vietnamese firms in IC design outsourcing allows for skill transfer, builds local capacity, and positions Vietnam as a reliable partner in the global semiconductor value chain.
Collaboration between industry, educators, and government should be boosted. Building a cohesive semiconductor workforce will require closer partnerships between educational institutions, industry players, and the government.
By integrating real-world projects into academic programmes, Vietnamese graduates will better understand the industry’s practical requirements and be more prepared to transition directly into the workforce. Schemes that bring industry projects to academia will provide students with hands-on experience, making them job-ready upon graduation.
At the same time, establishing specialised training for semiconductor roles, particularly in ATP and IC design, will be essential to reduce the industry’s current reliance on costly in-house training. This should involve upskilling engineers from related fields through short, intensive courses designed to meet industry standards.
Partnerships with international organisations for curriculum development, as well as accreditation for training initiatives, will help elevate Vietnam’s semiconductor workforce to global standards.
Vietnam can also implement “train-the-trainer” programmes. Its academic institutions face a shortage of faculty members with practical experience in semiconductor technologies. By leveraging international partnerships, Vietnam can upskill its instructors, who can then transfer these skills to future generations of engineers.
Notably, several US institutions have expressed willingness to offer training to Vietnamese trainers, a vital step towards creating a sustainable, locally driven semiconductor education ecosystem.
Finally, effective workforce development in the semiconductor industry requires government involvement in fostering a supportive ecosystem. Policies that incentivise partnerships between academia and industry, such as funding for research and development and joint training programmes, are critical.
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