‘Creating domestic demand to boost the semiconductor sector’

Talking on the sidelines of the International Conference on IC and Sensor Technology 2026 (Wefab 2026) held on June 19, Professor Konrad Young, former director of TSMC’s R&D Center, gave many suggestions to promote Vietnam’s semiconductor sector.

He believes that simple chips with competitive prices, serving the electric vehicle, agriculture and smart city markets, digital transformation… are the first step Vietnam can take. We should focus on areas where Vietnamese semiconductor products can generate immediate revenue and profits, then continue to reinvest in R&D. “Market demand is the key,” Professor Young said.

He said that a characteristic of the semiconductor industry is its high level of centralization. To reach the current scale and production level, TSMC or Intel have spent more than 50 years investing and accumulating capacity. Making large investments immediately to enter the modern semiconductor chip segment will be costly and ineffective.

The strategy of finding demand first, having a “good business cycle” and reinvesting are also lessons learned by TSMC. As one of the people who laid the foundation for the 0.13 micron process that has brought TSMC a leading position since the 2000s, Professor Young affirmed: “TSMC grows with customer needs.” First came the beginning of the PC era, then came ‘dot com’, mobile devices and today AI and big data.

He assessed that Vietnam’s fields of infrastructure, industry, smart agriculture, and digital transformation are all developing rapidly, creating opportunities for domestic semiconductors. This is a real need and can be controlled. “When there are domestic semiconductor products – designed or manufactured by Vietnamese enterprises, the government can issue policies requiring industrial or electronic equipment manufacturing enterprises to prioritize their use,” he recommended.

Vietnam’s semiconductor strategy has so far also determined to focus on domestic demand, according to Mr. Nguyen Anh Tuan, Director of the National Center for Support of Semiconductor Chip Trial Production. “Vietnam is determined to focus on specialized chips, serving national defense and security, telecommunications and digital transformation, not the high-tech segment that has a lot of competition from large global companies,” he said.

In January, Viettel Group started construction on a 32 nm process chip factory in Hoa Lac, with the goal of meeting chip demand for national industries. Taking advantage of the electronics manufacturing industry is also mentioned in Vietnam’s “C=SET+1” strategy.

However, Professor Young believes that the government can provide specific support to the extent of requiring the use of domestic semiconductor products in a certain percentage of products or in certain components of the product.

“The government’s support will mainly lie in policies to make industrial and electronic businesses ready to use and thereby provide opportunities for domestic products,” he said.

Mr. Woo Yong Jin, Director of Semiconductor Technology at Chungpa EMT, said that semiconductor manufacturing, especially in the early stages, requires long-term investment and high risk. Sharing experience from Korea, experts believe that the government can provide financial support and tax incentives for corporations to pursue their goals of expanding production and improving technology.

For example, the turning point product for Samsung to enter the global memory chip market was the 64 Kilobytes DRAM, which caused a loss of more than 300 million USD from 1984 to 1987 due to the market downturn. During 3 years, when many companies withdrew from the market, Samsung continued to invest in production capacity and became a major global supplier when DRAM demand increased again.

Sharing the same opinion, Dr. Le Quang Dam, General Director of Marvell Vietnam, said that Vietnam’s electronics industry must be ready to use domestic chips. “Here the role of the state is important, with encouragement and protection policies.”