Vietnam and Saudi Arabia Secure Major Manufacturing FDI to Diversify Global Supply Chains

According to recent reports from Reuters and Bloomberg, multinational corporations are continuing to adjust their manufacturing footprints to mitigate supply chain risks and access new markets. Major new investments in Vietnam and Saudi Arabia demonstrate how foreign direct investment (FDI) is being leveraged to build localized capabilities in high-tech sectors, specifically semiconductors and automotive manufacturing.

In Southeast Asia, Amkor Technology has committed an additional $1.07 billion to expand its semiconductor packaging and testing operations in Vietnam. As reported by Reuters, this new investment phase will bring the company’s total commitment at its Bac Ninh province site to $1.6 billion. The Vietnam Investment Review notes that the facility is designed to support next-generation high-performance computing and communications chips. This expansion is aimed at helping Amkor’s global semiconductor clients diversify their supply chains. Bloomberg reports that the investment is expected to generate high-tech jobs locally and elevate Vietnam’s standing within the global semiconductor value chain.

Meanwhile, in the Middle East, Saudi Arabia is advancing its industrial diversification goals through a new automotive partnership. Bloomberg reports that Hyundai Motor Company and Saudi Arabia’s Public Investment Fund (PIF) have officially broken ground on a $500 million joint venture assembly plant. Located in King Abdullah Economic City (KAEC), the highly automated vehicle manufacturing facility is designed to produce both internal combustion engine (ICE) and electric vehicles (EVs). According to the Wall Street Journal and Arab News, the plant has a planned annual capacity of 50,000 vehicles. This joint venture represents a key milestone in Saudi Arabia’s broader Vision 2030 strategy, which seeks to establish a localized automotive ecosystem and reduce the kingdom’s economic reliance on oil.

These two investments highlight a broader shift in global trade dynamics, where manufacturing is increasingly decentralized to enhance resilience. For Vietnam, securing a major expansion from a global packaging and testing provider like Amkor solidifies its role as an emerging hub for the semiconductor back-end process. For Saudi Arabia, partnering with an established global automaker like Hyundai allows the country to acquire manufacturing technology and build a domestic supply chain for advanced vehicles. Both projects demonstrate how host countries are using targeted FDI to transition from low-cost assembly to higher-value industrial manufacturing.

The trade implications of these moves are significant. In the semiconductor industry, packaging and testing have traditionally been concentrated in a few East Asian locations. Amkor’s expansion in Vietnam provides global chipmakers with an alternative destination, reducing the risk of single-point failures in the supply chain. This is particularly crucial for high-performance computing and communications chips, which are in high demand globally.

In the automotive sector, the Hyundai-PIF joint venture in KAEC is positioned to serve not only the domestic Saudi market but potentially the wider Middle East and North Africa region. By establishing a highly automated plant capable of producing both traditional and electric vehicles, Saudi Arabia is preparing its industrial base for the global transition toward cleaner transportation. This localized production capability is expected to attract component suppliers and ancillary services, further strengthening the regional automotive ecosystem.