SEA countries have their own ways of securing chips

As DIGITIMES Asia notes, with reports of high demand for chips, most governments in SEA are in precarious positions as they struggle to meet the demand. SEA countries, one after another, have the intention to build their domestic semiconductor ecosystems, including Indonesia and Vietnam.

It was foreseeable that the brewing geopolitical conflict, especially after US House Speaker Nancy Pelosi’s visit to Taiwan, would lead to a trade war, which would in turn create supply chain issues for businesses in SEA.

indonesia

PT Toyota Astra Motor (TAM), for instance, told the Jakarta Post that the company was worried that the prolonged semiconductor shortage was affecting the company’s production of cars, including electric vehicles (EVs).

Knowing the enormity of the consequence, the Indonesian government has been visiting various Japanese manufacturers at their headquarters, requesting that Indonesia be placed first when it comes to the flow of semiconductors.

“I want to make sure that their principals will prioritize semiconductors for their production in Indonesia, [so that] semiconductors from producers like Mitsubishi, Toyota and others will not go to factories outside Indonesia,” Indonesia Industry Minister Agus Gumiwang said.

The government reached out to Germany and the US in hopes of convincing them to build domestic industries to eventually produce chips in Indonesia. This echoes Indonesia’s intention in developing a domestic semiconductor ecosystem.

Vietnam

Viettel, the largest telecommunications service provider in Vietnam, has proposed to produce chips in order to meet domestic demand and for export in addition to offering e-payment services.

Prime Minister Pham Minh Chinh approved the proposal. He appointed Viettel to research and produce chips that are effectively and efficiently serving the country’s digital transformation process, including building a digital government, digital economy, and digital society. He insisted that Viettel should lead the transformation.

Chinh also approved Viettel to be an intermediary for financial switching and electronic clearing services and assigned related ministers to study the plan and report on it to the government.

The following is the content of Viettel’s proposal, quoting VnExpress International.

1. To promote chip production as a national security measure.

2. To be assigned the tasks of ensuring national defense and security, promoting its strengths, and demonstrating the pioneering role of state-owned companies in the fields of high-tech defense, construction, and cyber security and safety.

3. To deploy a national digital conversion platform, and work as an intermediary for financial switching services and electronic clearing services to facilitate the transfer of funds from one bank account to another.

4. To research green energy technology and modernize important infrastructure in the field of transportation, logistics, urban areas, and science and technology.

5. To have more leeway in deciding investment capital and salaries, as well as organizing its internal units.

6. To establish a new legal corridor for state-owned firms, such as a mechanism to make evaluations based on the principle of overall investment efficiency instead of relying on individual investment items and projects, and a mechanism to establish a venture capital fund for investment in innovative start-ups.