Vietnam Eyes Global Electronics Networks

Samsung plays a significant role in developing Vietnam’s supporting industries through many programs and projects with local enterprises

Export achievements and inherent challenges

In 2024, Vietnam’s electronics industry recorded export revenue of US$126.5 billion, accounting for over 34% of the country’s total export value (US$405 billion). Exports of computers, electronic products and components brought home US$72.6 billion, up 26.6% from 2023, while phones and components generated US$ 53.9 billion, up 2.9%.

However, most of the value came from foreign giants such as Samsung, LG and Apple while domestic companies primarily handle low-value tasks. According to the Ministry of Industry and Trade, the localization rate in the electronics industry currently remains just 5-10%. Most electronics sold in Vietnam are either fully imported or assembled locally using foreign components.

Data from the National Statistics Office (NSO) showed imports of electronics, computers and components hit a record US$107 billion in 2024, representing a year-on-year growth of 21.7%. This portrayed a heavy dependence on imported parts and limited domestic manufacturing capabilities.

Ms. Do Thi Thuy Huong, Member of the Executive Committee of the Vietnam Electronic Industries Association (VEIA), said: “Vietnam’s electronics and manufacturing sectors are typically labor-intensive, unlike other countries where these industries are driven by capital and technology. Presently, the development of Vietnam’s semiconductor industry spans manufacturing investment, technological process management and technological updates. Therefore, beyond chip designers, this industry needs talent that understands production processes at which Vietnam remains weak.”

Mr. Tran Huu Quyen, Chairman of VNPT Technology, said: “Electronics firms are still largely operating in low-value processing stages and their roles to end-products remain modest. Designing a complete electronic product still lacks both scale and capabilities.”

Mr. Tran Duc Tung, Deputy General Director of Hanel PT, shared: “Over the past decade, more Vietnamese companies have entered supply chains in mechanics, plastics and packaging, led by Japanese firms. But in electronics, few Vietnamese companies are experienced and capable enough to build their production systems that meet rigorous production standards required by Japanese partners.”

Elevating local firms for greater value capture

While the electronics industry contributes significantly to export revenue, local enterprises continue to face major hurdles. According to Ms. Do Thi Thuy Huong, most Vietnamese electronics companies as well as their related supporting companies are small or medium in size. At this scale, they often lack three key resources: capital, technology, and skilled human resources.

Moreover, Vietnamese electronics firms remain inclined to assembly and processing rather than building value chains or expanding into higher-value segments such as design, research and development (R&D) and distribution to gain higher value and create strong effects on other supporting industries to achieve joint development.

According to economic specialist Can Van Luc, electronics firms need to closely capture global trade and investment trends and key partners; leverage tax, fee and interest support policies to speed up digital transformation and circular business models; enhance the adoption of clean and local materials; and strongly develop supporting industries.

The government is already aware of this matter. Decision 68/QD-TTg on development of supporting industries, alongside preferential credit programs, standard certifications, technical consulting and digital transformation support, is being promoted. Nevertheless, implementation effectiveness remains limited at the enterprise level. Many companies reportedly still find it hard to access capital, handle time-consuming appraisal procedures and reach hands-on consulting. Some localities such as Ho Chi Minh City, Bac Ninh and Hai Phong have started building industrial support centers, but this model has yet to be scaled nationally.

As the world is seeing the post-pandemic restructuring of global supply chains where the “China1” trend continues, Vietnam must seize this rare “window of opportunity” to upgrade its supporting industries. A coordinated strategy is needed to align public policy, private-sector capacity, and foreign investment. Otherwise, Vietnam will possibly remain a location for factory placement, rather than becoming a true industrial hub.