On Thursday, South Korea said it aims to locally source half of materials, components and equipment in the semiconductor manufacturing industry by 2030, up from the current 30%.
The plan is part of President Yoon Suk-yeol’s administration’s strategy to strengthen the industry.
Korea, home of the top memory chip manufacturers SAMSUNG and SK Hynix, are looking to enhance supply chain stability and resources to become a superpower in this area.
The country’s chip industry ministry estimates that about 20 percent of equipment and 50 percent of raw materials come from local suppliers, the industry ministry said in a joint statement with other ministries.
“Despite some achievements in self-reliance, high-tech, key technologies are still heavily dependent on external parties,” adding that the US-China trade conflict and the Russia war -Ukraine continues to destabilize supply.
Accordingly, the government and private sector will invest 300 billion KRW (approximately Rs 2,000) in small business innovation and mergers and acquisitions of chip design firms, the ministry said. The investment will begin next year.
Under the plan, South Korea will also spend KRW 950 billion (approximately Rs 6,000) on feasibility studies on the development of electric and automated chips between 2024 and 2030 and KRW 1.25 trillion (approximately Rs 8,000). to develop artificial intelligence chips. in 2029.
The government will consider funding essential infrastructure, such as electricity and water supply, in places that serve as expansion of chip manufacturing hubs, including Pyeongtaek and Yongin. It will also consider extending tax breaks to infrastructure investments by large companies.
The ministry added that the private sector and the government will work together to train at least 150,000 people over 10 years to strengthen the semiconductor workforce.
Semiconductors have been Korea’s top export item for nine consecutive years. In 2021, they account for 19.9% of total exports.
© Thomson Reuters 2022
