South Korea to pour in $450 billion to become global chipmaking leader
With the global semiconductor industry facing a shortage, South Korea has announced a plan to invest $450 billion (510 trillion Korean won) to supercharge the country’s chipmaking industry, joining the likes of Taiwan, China, and the US to become the global leader in chip manufacturing.
The South Korean government unveiled a national blueprint that will see several ambitious investments in semiconductor research and production. Tech giants Samsung and SK Hynix, the semiconductor manufacturing arm of national telco SK Telecom, will be committing $151 billion (170 trillion Korean won) and $97 billion (109 trillion Korean won) respectively to expand their existing chipmaking facilities.
SK Hynix’s co-CEO, Park Jung-ho further revealed that SK Hynix will be building four new semiconductor plants in Yongin, the largest city in the Gyeonggi-do province in South Korea.
Samsung has also revealed that the company has commenced construction of a new manufacturing line “25 times the size of a football pitch” in the city of Pyeongtaek, south of Seoul. The new factory is scheduled for completion in 2022.
“The entire semiconductor industry is facing a watershed moment and now is the time to chart out a plan for long-term strategy and investment,” said Kim Ki-nam, Vice Chairman and Head of Device Solutions at Samsung.
“For the memory business, where Samsung has maintained its undisputed leadership position, the company will continue to make pre-emptive investments to lead the industry,” he added.
South Korea’s Finance Ministry has also announced a tax deduction ratio of 40 percent to encourage spending on chipmaking, an increase from the previous 30 percent.