Taiwan is the proven choice for advanced chip fabrication and foundry work. Vietnam is a large, fast-growing base for electronics assembly and exports, and its semiconductor build-out is mostly a 2030 plan rather than operating capacity. For most manufacturers, the right answer depends on which stage of the value chain you need, not on which country ranks higher overall.
Start with the stage of production you actually need
“Electronics manufacturing” and “semiconductor manufacturing” cover very different activities. A company assembling circuit boards into finished devices faces a different set of location decisions than one buying wafers, packaging chips, or designing integrated circuits. The sources reviewed for this comparison (government, central bank, statistical, trade and company publications dated 2024 to 2026) support fairly different conclusions for each stage.
| Production stage | Taiwan | Vietnam |
|---|---|---|
| Leading-edge wafer fabrication | Established at scale; the dominant global location for leading-edge chip manufacturing | Not an operating leading-edge base in the sources reviewed; a small-scale fabrication plant is a stated national goal |
| Foundry (contract chip manufacturing) | Established at scale; the largest share of global foundry revenue | Not established as a foundry base in the sources reviewed |
| Packaging and testing | Active investment in advanced packaging capacity, including CoWoS, reported by TSMC; sector-wide plant counts not stated | Stated national goal of ten packaging and testing plants; current operating count not stated |
| IC design | Established design sector described by the U.S. International Trade Administration; firm counts not stated in the sources reviewed | Stated national goal of at least 100 chip design firms; current count not stated |
| Electronics assembly and export | Large electronics and IC export base; comparable electronics-assembly totals not stated | Large, foreign-investment-driven electronics export base with multi-year export figures published by government agencies |
Taiwan: an operating semiconductor benchmark
Taiwan’s advantage is scale that is already running. The U.S. International Trade Administration’s country commercial guide for Taiwan, published and updated December 1, 2025, states that Taiwan accounts for over 60% of global foundry revenue and more than 90% of leading-edge chip manufacturing. The same guide reports Taiwan semiconductor industry revenue above US$165 billion in 2024.
Trade data from the same agency show Taiwan’s 2024 integrated-circuit manufacturing exports at US$165.042 billion and semiconductor equipment exports at US$4.948 billion. These are export values. They do not measure domestic value added or physical production capacity, and they should not be read as the same thing as the industry revenue figure above.
#1 Best Overall
Company-level data give a second angle. TSMC’s 2024 annual report says the company represented 34% of the output value of what it calls the “Foundry 2.0” industry in 2024. That category, as TSMC defines it, includes logic wafer manufacturing, packaging, testing, mask-making and other activities. The 34% is TSMC’s share of that defined global category, not Taiwan’s national share. TSMC also reports continuing investment in Taiwan in 3nm, 2nm and CoWoS technologies.
The practical implication is concentration. Taiwan’s position in foundry and leading-edge production is a strength for a buyer who needs those processes, but it also means a large share of that stage of global supply sits in one location and, in many cases, with one dominant supplier.
Vietnam: a large electronics base with a semiconductor plan
The electronics base that exists today
Vietnam’s electronics sector is already substantial, and it is built largely on foreign direct investment. Vietnam’s Ministry of Industry and Trade reported electronics exports of US$109 billion in 2023. Separately, the National Statistics Office reported 2024 exports of US$68 billion and imports above US$100 billion for a narrower category it labels “electronics, computers and components.” The two figures use different years and different category definitions, so they are not a single series and should not be combined or compared directly.
The Ministry of Planning and Investment’s 2024 summary says processing and manufacturing made up 61.4% of cumulative registered FDI in Vietnam by the end of 2024. It also notes large-scale semiconductor, component and electronics projects registered in 2024. Registered capital and announced projects show investment commitments; they are not production output, and the sources do not say how much of each project has been built.
The semiconductor strategy and what it sets out to do
Vietnam’s semiconductor development strategy was issued through Decision 1018/QD-TTg, dated September 21, 2024. Its goals run to 2030 and cover research, design, manufacturing, packaging and testing. The stated targets are:
- At least 100 chip design firms
- One small-scale fabrication factory
- Ten packaging and testing plants
- More than 50,000 semiconductor engineers and graduates trained
- Annual revenue targets above US$25 billion for semiconductors and US$225 billion for electronics
These are goals set by the government, not capacity that is already operating. The OECD’s 2025 survey of Vietnam describes the same ambition to attract investment and expand design, fabrication, packaging and testing, and it also describes structural challenges that the plan must address. Neither source reports that the targets have been met.
Relations between the two economies are also visible in investment. Taiwan’s International Trade Administration reports US$42.3 billion in cumulative Taiwanese investment in Vietnam from 1988 through 2025, which ranks Taiwan fourth among sources of Vietnam’s FDI for that period. That link is useful context for a cross-border supplier footprint, but it does not predict the cost or performance of any single project.
How to choose for a real manufacturing decision
Use the following sequence to narrow the question before you compare sites.
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- Define the process. Decide whether you need wafer fabrication, a specialty or mature-node process, packaging and testing, IC design, or electronics assembly. Taiwan is the stronger documented option for the first and third items at the leading edge; Vietnam’s documented strengths sit mostly in assembly, export and growing packaging and design activity.
- Map your supplier network. List the foundries, design houses, component makers, test providers, equipment vendors and customers your product depends on, and check which of them operate in each location. The sources reviewed support Taiwan’s dense foundry ecosystem and Vietnam’s electronics and FDI base, but they do not provide a supplier count for both countries that you could compare directly.
- Check workforce against the process. Vietnam’s 50,000-engineer target is a plan. Verify the availability of engineers with experience in your specific process, not just total graduate numbers.
- Measure local value added in your own project. National export totals do not show how much of a product’s value is captured locally. Price local sourcing, process ownership, engineering staffing and margin for the actual product.
- Price the things the sources do not cover. The reviewed sources do not quantify wages, land or building costs, tax incentives, power or water availability, or logistics costs. Any financial model needs those inputs from current, site-specific quotes and official incentive documents.
Risk: concentration versus build-out
The two locations carry different risks. Taiwan’s dominance in foundry and leading-edge manufacturing means a single-location concentration in a stage that many products cannot avoid. Vietnam’s semiconductor build-out could widen the range of options over time, but the sources reviewed do not show that Vietnamese capacity can replace specific Taiwanese processes or suppliers today. If diversification is the goal, treat Vietnam as a plan to be tested with a qualification program, not as a substitute already in place.
Measurement also remains a gap. The sources do not provide a harmonised figure for total electronics output or domestic value added for Taiwan and Vietnam. Taiwan’s figures are semiconductor revenue and IC trade values; Vietnam’s are electronics export categories and government targets. Ranking the two on one aggregate number would overstate what the evidence shows.
The official framing from Vietnam
The Government of Vietnam’s English-language account of the strategy summarises its roadmap as “C = SET + 1.” In that account, C stands for Chip, S for Specialized, E for Electronics and T for Talent, and “+ 1” represents the ambition to become a new and safe destination in the global semiconductor supply chain. This is the government’s own description of its plan, not an independent assessment.
Sources
- U.S. International Trade Administration, country commercial guide, Taiwan: Semiconductors including chip design for AI (published and updated 2025-12-01): https://www.trade.gov/country-commercial-guides/taiwan-semiconductors-including-chip-design-ai
- Taiwan Semiconductor Manufacturing Company, TSMC 2024 Annual Report (2025): https://investor.tsmc.com/static/annualReports/2024/english/index.html
- Vietnam Government News, summary of Decision 1018/QD-TTg (2024-09-23): https://en.baochinhphu.vn/govt-targets-to-raise-turnover-of-semiconductor-industry-to-us100-billion-by-2050-111240923114027879.htm
- Vietnam Government News, semiconductor industry development strategy (2024-12-14): https://en.baochinhphu.vn/semiconductor-industry-development-viet-nams-strategic-choice-and-top-priority-111241214200707427.htm
- Vietnam Ministry of Planning and Investment, FDI attraction situation in 2024 (2025-01-06): https://mpi.gov.vn/en/Pages/2025-1-14/FDI-attraction-situation-in-Vietnam-and-Vietnam-s-ehsipf.aspx
- Vietnam Ministry of Industry and Trade, supporting industry for electronics (2024-12-08): https://moit.gov.vn/en/news/viet-nam-s-supporting-industry-for-electronics-needs-more-support.html
- Vietnam National Statistics Office, electronics, computers and components exports 2016–2025 (2025-10): https://www.nso.gov.vn/du-lieu-va-so-lieu-thong-ke/2025/10/xuat-nhap-khau-dien-tu-may-tinh-va-linh-kien-dong-luc-tang-truong-xuat-khau-cua-viet-nam-giai-doan-2016-2025/
- OECD, OECD Economic Surveys: Viet Nam 2025 (2025-06): https://www.oecd.org/content/dam/oecd/en/publications/reports/2025/06/oecd-economic-surveys-viet-nam-2025_f2511b78/fb37254b-en.pdf
- Taiwan International Trade Administration, bilateral trade and investment statistics (1988–2025 investment data): https://www.trade.gov.tw/english/Pages/Detail.aspx?nodeID=4639&pid=743550
The Bottom Line
For leading-edge chips, foundry capacity and packaging at scale, Taiwan is the established choice and the one to use as a benchmark. For electronics assembly and export-oriented production, Vietnam is a serious, large and growing option, supported by foreign investment. Its semiconductor ambitions through 2030 are real policy commitments, but they are targets, so a semiconductor project in Vietnam should be qualified against current, site-specific capability rather than the national plan.
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