High risks, but big opportunities

Vice Mayor of HCM City Le Manh Ha admitted that this is a venture project, but it is a must because of the urgent domestic demand for IC products.

Ha said the city’s authorities would disburse money for the industry in 2013, while trying to attract high qualification workers, experienced domestic and international experts.

The clients of the IC industry prove to be profuse. The first orders to come would be the ones on the apps to solve the urban problems, such as the chips for traffic control, bank card, telephone SIM card.

In the long term, Ha said, HCM City would gather its strength on the industry, considering it the important foundation for the development of the information technology.

The HCM City’s program on developing the IC industry is a part of the national program on technology renovation in product development and high technology. The state has promised attractive investment incentives to the investors in the fields, including the ones on bank loan access and preferential interest rates.

However, according to Ha, the biggest worry for the project developers now is the market for their products. They wonder if their products can be consumed in the domestic market, and the technical barriers are strong enough to protect local production. Meanwhile, it is very costly and risky to make investment in developing high technologies.

HCM City has decided that it would obtain the turnover of $100-150 million by 2017 from the IC industry, train some 2,000 workers and incubate some 30 businesses in the field. The works would be started as soon as possible to be sure that everything would be ready, including the workforce, for the IC factory to be invested by the Saigon Industry Corporation which is expected to kick off in 2014.

The market awaiting hi-tech products

Investors have been shown the big scale of the domestic market, which analysts believe could have the value of US$2 billion a year, which means that the investors would have great opportunities to make and sell their products.

The investors have also been convinced that the HCM City authorities would do everything they can to facilitate their projects’ development. An analysis showed that if electronic and telecom products using domestically made IC, the production costs of the products would reduce by 15-30 percent.

The market segment alone, according to the estimates, would bring the turnover of $120 million a year at minimum by 2020. Experts believe that in the immediate time, investors don’t need to spend big money to use the most advanced technologies, but they just need to make popular products for the domestic market which is now much in demand.

In the long term, Vietnam’s IC industry should strive to develop high technology electronic chips to serve the national defense. All countries want to make the chips themselves to ensure the national security.

The experts have forecast that wifi 4G chips would be marketed by 2014 within the framework of a Vietnam-Japan cooperation project. Saigon Track plans to make 20,000 devices using 8-bit chips for motorbike and car positioning.

Dr. Le Hoai Quoc, Director of the HCM City High Tech Park, said the State should be the big client for the products to encourage investors to develop their projects.

Vietnamnet