Korea on track to become No. 2 chipmaker by 2032

Korea will claim 19 percent of the world's chip production by 2023, second only to China.

Aerial view of Korea's mega chip cluster under construction in Yongin, Gyeonggi. [YONHAP]

Korea will claim 19 percent of the world's chip production, second only to China, by 2032 on the back of ramped-up production capacity in the country, according to a report published by the Semiconductor Industry Association (SIA) on Wednesday.

The market share is two percentage points more than that of 2022.

However, Korea will be only responsible for nine percent of the global production of advanced logic chips, while the U.S. and Taiwan are set to control 75 percent of it in 2032.

Advanced logic chips, according to the SIA report, are logic processors that are manufactured with 10-nanometer or below technology.

The SIA, a U.S. lobbying group comprising more than 60 companies committed to chips, published a report in partnership with Boston Consulting Group titled "Emerging Resilience in the Semiconductor Supply Chain," lauding the U.S. CHIPS Act that is expected to drive up production in the U.S. by 203 percent by 2032 compared to 2022, the largest rate of growth globally.

Korea, during the cited period, is expected to see an expansion of 129 percent in domestic chip production, the report said, the second most, followed by 124 percent in Europe and by 97 percent in Taiwan. Japan and China are each forecast to experience an 86 percent increase.

"Korea invested early in the development of its semiconductor industry and supported the growth of Samsung and SK hynix into global semiconductor leaders; together, they have a majority share in the global NAND flash memory and DRAM chips markets, respectively," the report said.

On the back of the CHIPS Act, which committed $39 billion in grants and a 25 percent investment tax credit for chip production on U.S. soil, advanced logic chip manufacturing in the U.S. in 2032 is forecast to account for 28 percent from 0 percent in 2022, the report said.

Samsung Electronics, for example, is building at least two chip plants in Texas that produce four-nanometer or lower logic chips with the incentives.

The report added, "In the absence of [the CHIPS Act], the U.S. share in [leading-edge wafer fabrication capacity] would have slipped further to 8 percent by 2032."

Korea is committing $471 billion through 2047 to build 16 new chip fabrication plants in a mega cluster near Gyeonggi with the involvement of Samsung Electronics and SK hynix.

BY JIN EUN-SOO [jin.eunsoo@joongang.co.kr]