Government to Promote the Greatest “Semiconductor Alliance” and Follow-up Measures in Ten Major Areas to Reap the Fruits from the U.S. Trip

Deputy Prime Minister for Economic Affairs and Minister of Economy and Finance Choo Kyung-ho greets the ministers who attended the video conference from the government office in Sejong at the ministerial meeting for international economic affairs held at the government office in Seoul on May 8. Yonhap News

Deputy Prime Minister for Economic Affairs and Minister of Economy and Finance Choo Kyung-ho spoke about follow-up measures to President Yoon Suk-yeol’s latest state visit to the United States and announced, “We will do our utmost to promote follow-up measures in ten major fields for concrete results from the U.S. trip for the prosperity of both countries and our future generation.”

Deputy Prime Minister Choo made the announcement in his opening comment at a ministerial meeting on international economic affairs, which he presided over at the government office in Seoul on May 8. He made the statement as he announced that South Korea and the United States had established a firm base for a partnership in advanced technology and culture during the latest state visit to the U.S.

He mentioned semiconductors as the first task. He said, “We will newly launch collaborations and public-private partnership fora in the three promising fields of next-generation semiconductors, advanced packaging, and high-tech materials, parts, and equipment to create a base for the world’s greatest semiconductor alliance.”

As for the Inflation Reduction Act and the CHIPS and Science Act, the deputy prime minister explained, “Based on an agreement on the direction to reduce the burden and uncertainty of South Korean businesses, we will promote close cooperation to increase the predictability of remaining issues and to improve mutual interests.”

South Korea and the U.S. also plan to begin talks on key and new next-generation technology between the National Security Councils of the two countries in the second half of this year and seek technological cooperation in five fields--semiconductors, batteries, biotech, quantum technology, and digital technology--and develop clusters in Korea. The government will also work to bring in the US$5.9 billion of investment it raised during the trip earlier than scheduled.

The finance minister said, “We will analyze the success factors of the Boston bio cluster and create a similar special zone for global innovation in South Korea.” He further explained, “We will introduce a special completely negative regulation policy and create a Korean-style innovation cluster meeting global standards with groundbreaking upgrades to the current regulation-free zones.”

The government plans to designate two to three special global innovation zones centered on existing regulation-free zones this year and create a total of ten special innovation zones by 2027. The government also presented plans to focus on fifteen key projects in the four fields of overseas construction, plants, nuclear power plants, and eco-friendly projects to achieve overseas orders of $350 billion this year.

Contracts are expected to be signed in connection with large plant projects in the Middle East this year, and the government will work to promptly provide diplomatic and financial support. The deputy prime minister also explained that the government would support businesses expanding their scope in eco-friendly projects, such as green hydrogen, seawater desalination, and the international reduction of greenhouse gases. Policy banks such as the Export-Import Bank of Korea will operate a consultative body for financial investment in overseas infrastructure and prepare plans for joint investment.

Meanwhile, as for domestic and international economic conditions, Deputy Prime Minister Choo said, “Uncertainty remains high in the global economy due to the uncertainty concerning small and medium-sized banks in the U.S. and the possibility of major economies slowing down amidst concerns of high prices.” He further assessed, “The inflation is slowing down and domestic demand is making a slow recovery, but we still face challenges in export and investment.”