Samsung Electronics Co Ltd has received approval from Ho Chi Minh City authorities for a US$1 billion project to set up an LCD production plant in the southern hub of Vietnam, the municipal government announced Thursday.

The South Korean electronics giant will place its plant inside the Saigon Hi-Tech Park in District 9, according to the city’s deputy chairman Le Manh Ha.

The facility will produce LCD screens and related parts, and Samsung will try to meet all standards to enjoy investment incentives from the Vietnamese government as per the law on high technology, an official from the Ministry of Planning and Investment told Tuoi Tre (Youth) newspaper the same day.

Besides the manufacturing plant, the South Korean firm will also set up a research and development center, the official said, citing a proposal from Samsung.

The company has also pledged to follow the requirements to earmark at least one percent of total revenues for research and development activities.

Vietnam also requires that Samsung’s average revenues from hi-tech products in three consecutive years must account for at least 60 percent of its annual revenue, which the South Korean firm has also promised to follow.

“Samsung is the world’s leading smartphone maker and the top LCD supplier, so their presence in HCMC will greatly contribute to the country’s economy and investment attractiveness,” the official from the investment ministry remarked.

The newly approved project in Vietnam’s economic hub adds to the list of two other billion-dollar facilities operated by Samsung in the Southeast Asian country.

In 2009 Samsung inaugurated its mobile phone production plant Samsung Electronics VN in the northern province of Bac Ninh. The plant had an initial investment of $670 million, which eventually increased to $2.5 billion.

Four years later, the $2 billion Samsung Electronics VN Thai Nguyen complex broke ground in Thai Nguyen, another northern province.

Around 43,000 employees are working at the Bac Ninh facility, and the Thai Nguyen complex is expected to attract up to 50,000 workers.

It is estimated that Samsung’s two plants in Vietnam will produce $35 billion worth of mobile phones this year.

( Extracted from Vietnam Investment Review )