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South Korea
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South Korea lays out US$470 billion plan to build chipmaking hub

  • The area of Pyeongtaek to Yongin is expected to be the largest chip making region in the world, capable of producing 7.7 million wafers monthly by 2030
  • Investment of 622 trillion won (US$471 billion) from the private sector in the years leading up to 2047 is expected to safeguard domestic chips supply

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South Korean Industry Minister Ahn Duk-geun (middle) inspects a semiconductor production line during a visit to an SK Hynix plant in Incheon, southeast of Seoul. Photo: EPA-EFE
BloombergandThe Korea Times
South Korea unveiled plans by leading firms such as Samsung Electronics and SK Hynix to spend more than US$470 billion establishing the world’s largest chipmaking cluster, joining a global race to safeguard domestic supply.

The government on Monday outlined a blueprint involving investment of 622 trillion won (US$471 billion) from the private sector in the years leading up to 2047.

South Korea will spend the money to build 13 new chip plants and three research facilities, on top of an existing 21 fabs. Spanning Pyeongtaek to Yongin, the area is expected to be the largest in the world, capable of producing 7.7 million wafers monthly by 2030.
SK Hynix chipset microscheme close up. As part of South Korea’s two-decade plan, Samsung and Hynix are set to build their most sophisticated chip plants at home. Photo: Shutterstock
SK Hynix chipset microscheme close up. As part of South Korea’s two-decade plan, Samsung and Hynix are set to build their most sophisticated chip plants at home. Photo: Shutterstock

The envisioned investment is up sharply from when Seoul first unveiled Samsung’s and Hynix’s plans in 2023. South Korea’s government, which works closely with private firms on national imperatives, has been boosting its support for a domestic chip sector that accounts for about 16 per cent of total exports.

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It is pledged to protect a linchpin of its economy while grappling with rising global competition. As Japan and Taiwan aggressively invest in their own chip sectors, the South Korean government is committing to extending big tax breaks to local chip firms.

As part of the two-decade plan, Samsung and Hynix are set to build their most sophisticated chip plants at home. Samsung’s betting big on foundry – or making chips for other firms – as part of a 500 trillion won investment by 2047. Smaller rival Hynix aims to invest 122 trillion won in memory in Yongin over the same period.

The government said the region will also house smaller chip design and materials companies. The overarching ambition is to improve the country’s self-sufficiency in semiconductors, while increasing its market share of global logic chip production to 10 per cent by 2030 from 3 per cent now.

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