Korea to invest $472 bn for semiconductor mega cluster

President Yoon Suk Yeol attends a policy debate to discuss ways to improve people’s livelihoods through semiconductor-related sectors. [Photo by Lee Seung-hwan]

South Korean President Yoon Suk Yeol said on Monday that the country is “building the world’s largest semiconductor mega cluster that will run through southern Gyeonggi Province.”

“We are aiming to invest 622 trillion won ($472 billion), which will create 3 million quality jobs over the next 20 years,” Yoon said during a policy debate held at Sungkyunkwan University’s Natural Sciences Campus in Suwon, Gyeonggi Province, the third in a series of debates on livelihood issues.

The Korean government announced a plan for a ‘semiconductor mega cluster’ in 2023, which is expected to be completed in 2047 with the investment of 622 trillion won from Samsung Electronics Co., SK hynix Inc. and other companies. The plan also designated Pangyo, Suwon, and Pyeongtaek as the three main hubs for semiconductor research and development (R&D) and education.

The government expects the semiconductor mega cluster to generate 650 trillion won in production while nurturing talent and securing innovative technologies centered around these hub cities.

Yoon noted that other countries are also building semiconductor clusters. “When I talk to foreign leaders about Korea, the most discussed topics are BTS and semiconductors,” he said. “There is a very fierce war among developed countries to build semiconductor mega clusters.”

He also vowed to mobilize all available resources to develop the country’s semiconductor industry. “The semiconductor industry is a strategic industry that can succeed only if the country’s human and material resources are fully invested,” Yoon said, reinforcing his commitment to the plan.

The president made his intention to develop the nuclear power industry clear, saying, “Nuclear power is now a must,” as stable power is needed to develop cutting-edge science and technology industries, including semiconductors.

He added that tax exemptions or subsidies could lead to increased tax revenues. “We will continue the semiconductor investment tax credit, which expires in 2024, by improving its effectiveness,” Yoon said, noting that “talk of helping big companies and making it harder for those in need is absolutely false.”