South Korea confirms $19bn chip market support package
The South Korean President, Yoon Suk-yeol, has announced a financial aid programme worth about USD 19 billion to support domestic semiconductor firms. The funds will be allocated by the state-run Korea Development Bank.
South Korea is a global powerhouse – home to the world’s top memory chip makers Samsung Electronics and SK Hynix – but it has fallen behind in some areas such as semiconductor design and contract manufacturing. In fact, its share of the fabless design space is reckoned to be 1%. Ahn Duk-geun, Minister of Trade, Industry and Energy, said the programme can help boost South Korea’s global market share in non-memory to 10 per cent.
Suk-yeol was blunt in his assessment of the challenge. He said: “As we all know, semiconductors are a field where all-out national warfare is under way. Win or lose, that depends on who can make cutting-edge semiconductors first.”
Of course South Korea is not alone in making available public funds to help chip firms. The US, China and the EU have all created programmes for this purpose. But this South Korean fund is far bigger than expected. Earlier this month, it was rumoured that the pot would be worth USD 7.3 billion.
And last year, the government revealed a plan to create a USD 472bn ‘semiconductor mega cluster’. It will span a new 21 million square metre industrial zone within the southern Gyeonggi Province, the expansion of the existing 21 fabrication facilities in the area, along with the creation of fabless plants in Pangyo and the construction of foundry and memory chip production facilities in Hwaseong, Yongin, Icheon, and Pyeongtaek.
