Is Vietnam becoming the technology manufacturing powerhouse in Southeast Asia?

What do we see as high tech manufacturing ?

  • integrated electronic circuitry: chips, microprocessors, ASIC…
  • complex mechanical sets requiring advanced know-how in metallurgy, physics of materials, chemistry, mechanical science, and application specialty: turbomachines, airplanes, efficient electric motors, surgery robots, radars…
  • micromechanics: complex micromechanical sets used in miniaturized products: MEMS, micro parts, microactuators…
  • products requiring complex chemical processes developed thanks to long and costly researches: special coatings, technical textiles, and fibers, innovative medicines.
  • genomics-biotechnology;

All the above fields are currently dominated by Western powerhouses, even China is dependent on them (see the cases of ZTE vs. USA, turbofans engines, machine tools…)

Vietnam has not any significant indigenous company operating in those fields. There is this company Nanogen website founded by a returnee from the USA but I don’t know how it fares.

Foreign investments in high tech manufacturing are scarce: the output of the Intel experimental facilities in Saigon is negligible. Samsung Giga factories in Vietnam are factories where cheap low skilled human workforce are assembling imported parts. Automobile factories in Vietnam, including Truong Hai auto, assemble cars from imported parts. General Electric and Bosch factories in VN are essentially assembling plants.

It is difficult to forecast because at this moment, high tech manufacturing is not on the agenda of local investors because it is too capital intensive.

A local company tried to launch a locally assembled high-end mobile phone brand named Bphone. The company’s CEO claimed the product is 100% made in Vietnam to entice national pride. Investigations uncovered that 100% of parts were made in China, even the metal case was machined in China. The mobile phone was ill-designed anyway.

The coming kid is Vingroup, a chaebol wannabee that reaped huge profit in real estate plans to produce cars, electric cycles in Vietnam under the brand Vinfast…Let us see whether it will fare better than Proton did in Malaysia.

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