Samsung Electronics is planning to invest $1.5 billion to build a semiconductor testing plant in Vietnam in an effort to ease the global memory chip shortage.

Per a report by Reuters citing a proposal document from the company, construction on the new factory has already begun at an industrial park 60 kilometres (37 miles) north of Hanoi.

Vietnamese authorities approved the investment in March, Reuters added, with Samsung reportedly planning to reinvest any profits from the site up to $2.5bn in a potential second factory.

The current facility is expected to be operational by November 2027 and would be the company’s first chip testing plant in the country. The report further noted that the factory would focus on the development of memory chips, with an anticipated annual capacity to deliver 153.3bn GB of DRAM chips and 255.6bn GB of NAND memory chips.

The news comes as the industry attempts to grapple with a shortage of storage and memory hardware, with the size and scale of many recent AI data center build-outs seemingly having caught the market off guard and resulting in a capacity crunch.

Samsung has previously warned that the memory chip shortage is predicted to continue into 2027 and beyond, with consumer electronics likely to suffer the most in the face of ongoing shortages, as capacity will increasingly become allocated to AI infrastructure projects.

Speaking on the company’s earnings call following the publication of the company’s Q1 2026 results, Jaejune Kim, EVP of Samsung’s memory business, told analysts that available memory supply is far short of customer demand, stating: “Our demand fulfillment rate is now at a record low, and unlike previous years, customers who are concerned about supply shortages are actually bringing forward their demand for 2027.”

The chip testing facility is not the only project Samsung is currently undertaking in Vietnam. Last month, reports emerged that the company was planning to invest $4bn in ‌a chip packaging factory in Vietnam, located in the Thai Nguyen province in northern Vietnam, and developed in multiple phases. Samsung is the largest foreign investor in Vietnam, having invested more than $23bn in the country to date, according to the government.

In recent years, the Vietnamese government has been looking to transition the country away from being a low-cost manufacturing hub by investing in chip research, design, and production.

In addition to offering a number of financial incentives to attract private investment in the sector, including land allocation and tax benefits, in March 2025, the government announced it was planning to invest $500 million to build a semiconductor research, design, production, packaging, and testing facility.