Samsung will invest $230 billion in South Korea to create the “world’s largest” chip facility.
With an estimated $230 billion investment by memory chip juggernaut Samsung Electronics, South Korea claims it will construct a sizable facility to manufacture computer chips in the greater Seoul area.
President Yoon Suk Yeol revealed the plans on Wednesday, and the electronics behemoth later confirmed them.
According to him, the Seoul Metropolitan Area will house the largest new “high-tech system semiconductor cluster” in the entire globe thanks to significant private investment of about 300 trillion Korean won. Additionally, in conjunction with the current memory semiconductor manufacturing complexes, we will expand the “semiconductor mega cluster” to become the largest in the world. According to a government announcement, the chip cluster will be situated in the Seoul Metropolitan Area’s Gyeonggi province, and the overall investment would be finished in around 20 years.
According to the statement, which provided no other information, the nation will modify its Industrial Technology Protection Act to defend intellectual property. Samsung (SSNLF) announced a plan in May of last year to invest more than $350 billion in its companies and add tens of thousands of new jobs by the year 2026. It declared that it would put most of its money into key industries like chip manufacturing and biopharmaceuticals.
It wasn’t immediately obvious whether the investment that had been previously disclosed would overlap with the one that the government had announced on Wednesday. The estimated average annual investment that Samsung wants to make in its foundry or contract manufacturing business over the next two decades appears to be around 15 trillion won, which is comparable to the company’s current annual capital expenditure in that sector.
He stated, “This is in line with market expectations.
The electronics sector of Samsung is primarily recognized for its well-liked smartphones and televisions. The company has shifted its focus more toward being a supplier of semiconductors in recent years as shortages affect manufacturers all across the world. In the market for premium computer chips, Samsung is in direct competition with Taiwan’s TSMC and Intel (INTC).
Only two locations, Taiwan and South Korea, produce the great bulk of the world’s sophisticated microchips. South Korea is eager to compete with Taiwan’s larger and more powerful sector.
Concerns about the stability of the global supply chain have been raised as a result of the concentration of so much crucial chip production in just two locations, particularly given that China and North Korea, the neighbors of South Korea and Taiwan, respectively, are militarily threatening both countries.
Many economies have expressed worry over the past three years about losing access to semiconductors, especially as political and economic animosity between China and the United States has increased.
Major corporations like Apple and other governments, including Washington, have requested that semiconductor businesses localize their activities.
