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Fri, Feb 24, 2006 - Page 12 News List

Intel to build new plant in Vietnam

CHIP FACILITY Sources from within the Vietnamese government said a license had been granted for the plant, but the chip giant declined to confirm the news


The world's largest chipmaker Intel Corp received a license from the Vietnamese government to build a chip plant worth US$605 million in southern Ho Chi Minh City, official sources said yesterday.

According to recent reports in the state media, the plant will cover 46.7 hectares and employ 2,000 local workers, providing a massive boost to Vietnam's IT industry.

"We [have] agreed to give them the license already," an official at the Ministry of Planning and Investment said.

The US company in the southern business hub of Ho Chi Minh City declined comment but said a press release would be issued in the next few days.

In late 2003, Intel signed an agreement with FPT, a semi-private Vietnamese IT company, for the sale of central processing units, main boards and other components at preferential prices to manufacture desktops, laptops and servers under the Vietnamese company's Elead brand.

Analysts say the US giant is attracted to Vietnam because of a cheap and educated labor force, and in order to diversify locations and share risks.

The communist nation has enjoyed 7.0 to 8.0 percent annual growth rates over the past five years.

However, most of the country's private and state-owned enterprises remain ill-equipped.

Last June, Intel president Paul Otellini said his company was already enjoying growing Vietnamese sales, the fastest growing PC market among the 10 members of ASEAN.

Otellini had visited Vietnam to sign an deal with the government to improve accessibility of information technologies throughout the country.

In December, Intel said it would invest US$230 million in Malaysia as part of a three-year expansion plan. It also said it was planning to invest more than US$1 billion on expanding in India in the next five years.

Intel's Vietnam interests

* Recent reports in Vietnam's state media say that the plant will cover 46.7 hectares and employ 2,000 local workers.

* Intel officials in Ho Chi Minh City declined to comment but said a release would be issued in the next few days.

* Intel inked a deal with Vietnamese company FPT in 2003 for the sale of CPUs, main boards and components to make IT products under FPT's Elead brand.

* Analysts say Intel is attracted by Vietnam's cheap and educated labor force.

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