South Korea to Localise 50 Percent of Chip Materials Supply by 2030 in Bid to Strengthen Industry

Semiconductors accounted for 19.9 percent of all exports from South Korea and have been the country’s top exports for nine years in a row.

By Reuters | Updated: 21 July 2022 12:07 IST

South Korea to Localise 50 Percent of Chip Materials Supply by 2030 in Bid to Strengthen Industry

Photo Credit: Reuters

The plan is part of President Yoon Suk-yeol administration's strategy to strengthen the industry

Highlights

South Korea will spend KRW 1.25 trillion to develop AI chips by 2029
The government, private sector will invest KRW 300 billion
Samsung, SK Hynix are the country's top chip makers

South Korea said on Thursday it aimed at local sourcing for half of its materials, components and equipment in semiconductor manufacturing by 2030, up from 30% currently.

The plan is part of President Yoon Suk-yeol administration's strategy to strengthen the industry.

South Korea, home to top memory chip makers Samsung and SK Hynix, is seeking to bolster supply chain stability and resources to become a superpower in the field.

iPhone Maker Foxconn Partners With NXP Semiconductors for EV Platforms

The country's chip industry estimated that about 20 percent of its equipment and 50 percent of materials came 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 highly dependent on outside parties," it said, adding that the US-China trade conflict and the Russia-Ukraine war continued to destabilise supplies.

Accordingly, the government and private sector would invest KRW 300 billion (roughly Rs. 2,000 crore) in small-business innovation and in mergers and acquisitions of chip design firms, the ministry said. The investment would begin next year.

US Chip Bill Gains Momentum Ahead of Senate Vote: All Details

Under the plan, South Korea will also spend KRW 950 billion (roughly Rs. 6,000 crore) on feasibility studies on the development of power and auto chips from 2024 to 2030 and KRW 1.25 trillion (roughly Rs. 8,000 crore) to develop artificial intelligence chips by 2029.

The government will look at funding for essential infrastructure, such as electricity and water supply, at places that serve as expanding chip production hubs, including Pyeongtaek and Yongin. It will also consider enlarging tax breaks for infrastructure investment by large firms.

The private sector and government would work together to train at least 150,000 people over 10 years to bolster the semiconductor labour force, the ministry added.

TSMC Quarterly Profit Surges 76 Percent, Beats Market Estimates

Semiconductors have been South Korea's top exports for nine years in a row. In 2021 they accounted for 19.9 percent of all exports.

Do Samsung's Galaxy S22 and Tab S8 series have any Android competition? We discuss this on Orbital, the Gadgets 360 podcast. Orbital is available on Spotify, Gaana, JioSaavn, Google Podcasts, Apple Podcasts, Amazon Music and wherever you get your podcasts.

Affiliate links may be automatically generated - see our ethics statement for details.

Comments

For the latest tech news and reviews, follow Gadgets 360 on X, Facebook, WhatsApp, Threads and Google News. For the latest videos on gadgets and tech, subscribe to our YouTube channel. If you want to know everything about top influencers, follow our in-house Who'sThat360 on Instagram and YouTube.