Crux: Samsung will invest $230 billion to build an enormous chip manufacturing facility as part of an ambitious South Korean project to boost the country’s chip industry and become a “superpower in the high-tech industry”.
The world’s biggest memory chip maker, Samsung Electronics, plans to invest 300 trillion won ($230 billion) over the next 20 years as part of South Korean government project to build the world’s largest semiconductor manufacturing base near the capital, Seoul.
South Korea is home to the world’s two biggest memory chip makers, Samsung and SK Hynix.
Semiconductor cluster: The chip-making “mega cluster” will be established in Gyeonggi Province by 2042. The South Korean government said that companies will build five chip manufacturing facilities in the cluster which will aim to attract 150 other companies producing materials and components or designing high-tech chips.
The semiconductor cluster is part of the South Korean government’s plans to invest $422 billion (500 trillion won) by 2026 to promote six key technology industries: semiconductors, rechargeable batteries, electric vehicles, robotics, displays, and biotechnology.
South Korea aims to become high-tech superpower
South Korea’s Ministry of Trade, Industry and Energy (MOTIE) said it would commit $260 billion (340 trillion won) specifically for the chip space to develop system semiconductors by 2026, to nurture national industry and become a “superpower in the high-tech industry”.
South Korean President Yoon Suk Yeol described technology industries as the country’s “key economic growth engines and security and strategic assets that are also directly linked to job creation and livelihoods.”
South Korea unveiled its plan as other technology powerhouses, including the United States, China and Japan, are ramping up their domestic chip manufacturing,
Semiconductors are an essential component of the microchips that power virtually every modern electronic device from smartphones to cars. The five major global semiconductor producers are Taiwan, South Korea, China, Japan and the United States.
US-Chian chip rivalry:
Semiconductor technology has become an increasingly politicized issue amidst geopolitical and economic tensions between the U.S. and China.
The United States is pursuing a two-pronged approach: pushing for chip manufacturing to return to American soil through commitments from major players like Samsung and Taiwan’s TSMC and also working to curb China’s semiconductor development with bans on exporting chip technology to Beijing. The U.S. has also formed alliances with Japan, South Korea, Taiwan, and recently the Netherlands to restrict China’s access to vital technology.
