“Vietnam’s first semiconductor factory construction plan delayed…Test production next year will likely be difficult.”

It has been reported that Vietnam's ambitious plan to build its first semiconductor batch production plant is being delayed, and pilot production next year as initially targeted will not be easy.

According to Reuters on the 27th (local time), Vietnamese state-run telecommunications company Viettel, which is in charge of this project, lacks experience in building a semiconductor factory and is experiencing administrative difficulties in quickly raising government funds, so it will be virtually difficult to achieve the test production target next year, a person familiar with the matter said.

In fact, Reuters reporters found that the factory site located on the outskirts of Hanoi was still covered with weeds. Satellite images also showed that no factory buildings had been constructed at all.

Viettel has also been negotiating with ASML, a world-class exposure equipment company in the Netherlands, for several months to purchase deep ultraviolet (DUV) exposure equipment needed for semiconductor production, but it has been reported that a contract has not yet been signed.

However, Reuters reported that it is not yet clear what specific equipment is being negotiated for purchase or why an agreement has not yet been reached.

Viettel held a factory groundbreaking ceremony at the site last January and announced plans to fully operate the factory by 2030 to produce semiconductors and supply them to the automobile, communications, and aerospace fields.

About $1.3 billion (about 1.73 trillion won) will be invested in this factory, and it is planned to use 32 nanometer (nm) process technology.

The 32-nano process is considered a very bold starting point for a new company entering the semiconductor manufacturing field.

India's Tata Electronics is working with Taiwanese semiconductor company PSMC to build a semiconductor factory worth $11 billion (approximately KRW 14.6 trillion) in Gujarat, western India. We plan to start with the 55-nano and 90-nano processes and then develop into the 28-nano process in the future.

However, the mention of the 32-nano process was later deleted from the Viettel website, and it is not disclosed whether the company has a cooperative relationship with existing semiconductor manufacturers to receive related technology.

Viettel, a telecommunications and defense company under the Vietnamese military, told Reuters that the semiconductor factory project is "progressing in line with the established plan and schedule" and that it "will share additional progress at the appropriate time."

In Vietnam, factories in the back-end process field such as semiconductor assembly, testing, and packaging (ATP) operated by Intel, Amkor Technology, and Hana Micron are operating. Samsung Electronics also plans to build a semiconductor test factory locally.

However, there is still no full-scale semiconductor production plant including all processes.