Vietnam targets FDI to fund AI, big data development, prime minister says
It looks to rake in more than US$100 billion a year in revenue from the semiconductor industry by 2050, as it emerges as a viable alternative to China
Published Thu, Sep 26, 2024 · 05:58 PM
VIETNAM’S Prime Minister Pham Minh Chinh vowed to lure “crucial” foreign investment into artificial intelligence (AI) development by cutting logistics costs and improving infrastructure, as the country seeks to establish itself as a global hub for advanced technology.
The prime minister urged businesses to act more boldly and increase resources in the sphere, as the government aims to “improve Vietnam’s competitiveness, labor productivity and its position in the international arena”, he said on Wednesday (Sep 25).
Vietnam will be a “good place” for foreign investors with “relaxed regulatory mechanisms”, the premier said, adding that “ministries will have to find ways” to help reduce costs.
He was speaking at the inauguration of the Centre for the Fourth Industrial Revolution, which was set up by the World Economic Forum and the People’s Committee of Ho Chi Minh City, with a mission to focus on green growth.
The prime minister noted that reliable electricity is a key demand of global suppliers and advanced technology, both of which Vietnam is aggressively pursuing.
The government will ensure the lights stay on for factories by providing a reliable supply of electricity, he added.
Vietnam has grappled with power shortages even as it has become a global electronics manufacturing hub. Last year, major blackouts caused disruption to factory operations in the northern region.
Like governments around the region, Vietnam has sought to pull in capital from foreign tech giants, particularly as the country has emerged as a viable alternative to China as a manufacturing base.
Intel operates a chip-assembly and test-manufacturing facility in the commercial hub, while the South-east Asian country has also attracted the likes of Apple suppliers and Samsung Electronics.
Vietnam has targeted more than US$100 billion a year in revenue from the semiconductor industry by 2050. It has set out ambitious plans for the semiconductor sector, seen as key to economic expansion.
The country’s growth is accelerating and could exceed the government’s 6.5 per cent target this year, as the economy is benefiting from increasing exports and foreign direct investment, said a July forecast from the Planning and Investment Ministry.
The International Monetary Fund has forecast Vietnam’s gross domestic product to expand 6 per cent this year, up from 5 per cent in 2023 – a pace that would make it among Asia’s fastest-growing economies.
Vietnam, nonetheless, is looking to ink more free trade agreements to further boost growth, the premier said.
“We already have 16 free trade agreements now, and we need to get more free trade agreements to expand in new markets,” he added. BLOOMBERG
