Intel plans to invest $300 million in Vietnam on a chip assembly and testing plant, the company said Tuesday. It will be the first factory of its kind ever built in Vietnam.

The plant, to be located in Ho Chi Minh City (formerly known as Saigon), will eventually employ 1,200 people, mainly Vietnamese, Intel said in a statement. Construction will begin immediately.

Intel cited Vietnam's progress in building its technology infrastructure, as well as the need to support demand for its chips as the main reasons for the investment.

Once finished, it will be Intel's seventh chip assembly site in the company's global network, which includes Penang and Kulim, Malaysia; Cavite, Philippines; Chengdu and Shanghai, China; and San Jose, Costa Rica.

Intel plans to spend over $6 billion by the end of this year on new factories and equipment, the company said.