Intel to invest a billion US dollars in Vietnam

But Will It Payoff?

KGO By Karina Rusk

Nov. 10 - The world's largest computer chip maker has decided to triple its investment in Vietnam. The World Trade Organization has just accepted the still communist country, as it eases toward a free-market system.

Vietnam is a nation of 84 million people and trails only China on Asia's list of fastest growing economies. Intel has decided Vietnam's Ho Chi Minh City will be the first place the chipmaker builds its new generation of huge, high efficiency chip assembly and test facilities, the investment is $1 billion dollars.

Chuck Mulloy, Intel Corporation: "Seventy percent of our sales come from outside the U.S.. We try to invest in those markets growing the fastest so we get a return on it."

Liem Nguyen grew up not far from where Intel will break ground. Nguyen is now the director of a San Jose Vietnamese Temple.

Liem Nguyen, Temple director: "I am a software engineer and I am very happy to see Intel doing this to our country and to our people over there."

Intel's investment is just one example of Vietnam's dynamic future. Nguyen sees accelerated growth with each visit.

Liem Nguyen: "There's a lot of change - significant change - everyday."

The Sai Gon High Tech Park is just three years old. It's a magnet for high tech foreign investment with a targeted production value of $4.5 billion dollars by 2010.

Chuck Mulloy: "They have demonstrated, to us at least, a great desire to move forward and advance themselves in the technology industry and so on and that's one of the things that attracted us."

Trade between the U.S. and Vietnam has grown from $1.2 billion in 2000 to $7.8 billion last year and this week the World Trade Organization accepted Vietnam. Many economists say better jobs and wages could eventually promote improved human rights in Vietnam.

Dr. Terry Connelly is Dean of the Ageno School of Business at Golden Gate University.

Dr. Terry Connelly: "Nothing moves us closer to more liberalized politics than an activated and inspirational middle class, and I think that's what these types of investment patterns and those that will follow really open the doors too."