VietNamNet Bridge – The semiconductor industry is a growing sector in Viet Nam and has attracted many foreign investors. Viet Nam News reporter Thu Ngan talks with Ng Kai Fai, president of SEMI Southeast Asia, about the industry and the upcoming 2017 SEMICON Southeast Asia Penang, Malaysia.

Ng Kai Fai

How do you see the potential of the Vietnamese semi-conductor industry?

A lot of people are talking about the potential of the country’s electronics industry, including semiconductors.

In think for the next five years everybody is projecting a compounded annual growth rate of almost 15-16 per cent. That is pretty significant. I think there is a lot of potential in Viet Nam in the electronics supply chain. Viet Nam’s electronic exports are almost 30 per cent of its total exports. That is huge.

The foreign direct investment inflow into electronics is significant as well.

I think for the next phase of Việt Nam’s growth, there is a needs to nurture and enhance the talent and capabilities of local indigenous companies. Just now I spoke about the electronic exports from Việt Nam. Close to ninety per cent of the exports comes from foreign direct investment (FDI) companies. Only a very small portion comes from local companies. So I think it is very important that local companies start developing technical capabilities for higher value added services in the electronics sector to fuel this continuous growth sector in future.

How is the Vietnamese semi-conductor market compared to those in neighbouring countries?

If you look at electronics exports alone, Việt Nam has surpassed Singapore, Malaysia and Thailand. That’s how incredible the growth of the Vietnamese electronics industry is.

Again, of course, if you look at exports, you have to look at the imports.

Electronics exports are large but the import of electronic components is also high. So what does that mean?

This probably is an indicator that there is still a wide gap between what can be  manufactured in Việt Nam in term of electronic component in order to make the final product.

So there is a huge opportunity for local companies to start enhancing value addition in terms of manufacturing of electronic components to supplement export growth.

What do you think are the strengths of Vietnamese companies?

Viet Nam has lots of potential. It has a population of 90 million. Viet Nam has a very young population that is important for every industry. The talented people I met are eager for knowledge, and that is important. You need to be able to demonstrate a continuous learning ability to grow the semi-conductor industry.

I think the Vietnamese Government has been greatly encouraging the electronics industry. In fact, it has identified the semiconductor and ICT industry as a major sector. I think it is important for companies.

The weaknesses, I think, in Viet Nam is the limitation of deep seated technical capabilities. That is one. I think for the country to continue to grow and reap the fruits of growth, we need to focus on developing local companies’ capabilities so that they can create higher value and also at the same time increase the talents in different technical branches as semiconductor industry demands talents from multitude of discipline.

The second thing I think is infrastructure for the electronics industry in Viet Nam is still in its infancy, still not complete. Again, how does Viet Nam intend to shorten the time to enable the infrastructure to a fully vibrant ecosystem? I think one of the key is for Vietnamese companies to seek partnership and collaboration within regional experienced players; and this is the initiative of HCM City Semiconductor Industry Association (HSIA) leading a delegation to SEMICON Southeast Asia is about.  Given that SEMICON Southeast Asia is the largest electronics supply chain event in Southeast Asia, there is no better event to learn, share and hopefully finding the right partners within this region for future collaboration and bringing technical value inside Viet Nam.

Semiconductor Southeast Asia is going to be organised in April. Can you tell us about the event?

The 2017 Southeast Semiconductor Southeast Asia is one of the premier events for the high-tech electronics exhibition and technical conferences. This event attracts professionals and thoughts leaders, high end suppliers, technical expertise and investors all in one locality for sharing of technology knowhow and business matching.

We have professionals from the Philippines, Malaysia, Singapore, Thailand, and Viet Nam, and also companies from India.

We have more than 200 companies exhibiting with excess of projected 300 booths. SEMICON Southeast Asia is one of the eminent platforms amongst activities that SEMI organizes to facilitate the development of the semiconductor and high tech electronics industry within the region. One there will be a forum hosted by HSIA and delegation to talk about the Viet Nam’s aspiration, Government policies and plans towards growing the semiconductor industry in the country. There will also be potential business matching to match capabilities of local companies in Viet Nam to regional companies such as those from Malaysia or Singapore whom have deep experience on supporting the industry.

Talent in the semi-conductor industry is important and so enhancing the Vietnamese talent pool and talent capability is a very important component in developing the electronics and semi-conductor eco-system in Viet Nam. I could not stress more for Viet Nam to take advantage of this platform; SEMICON Southeast Asia, to accelerate the growth in Viet Nam.

 VNS