Samsung Electronics anticipates spending hundreds of billions to create the largest chip center hub in the world. This investment is part of a South Korean government initiative to acquire an additional competitive edge in the global semiconductor market.
In the next 20 years, Seoul plans to construct the largest chip center in the world, partly with the help of 300 trillion won ($230 billion or €220 billion) in private investment from electronics giant Samsung.
By 2042, a new “mega cluster” of facilities for chip fabrication will be constructed throughout Gyeonggi Province.
Five new Samsung semiconductor manufacturing facilities will support the center.
The plan to build World’s Largest Chip Center
The South Korean government wants to make significant investments in six different technology sectors, including robotics, biotechnology, electric cars, rechargeable batteries, processors, and displays.
The government wants to capitalize on the rising demand brought on by the adoption of new technologies like 5G wireless networks, artificial intelligence, and self-driving cars, even though the nation is well-established in these industries.
South Korea will “create the world’s largest scale system semiconductors cluster in the capital districts. Additionally, this will employ enormous private investments worth 300 trillion won,” according to President Yoon Suk-yeol.
At a discussion on economic policy, Yoon said: “Speed is crucial. The administration will make every effort to see the cluster project through.”
According to South Korea’s Ministry of Trade, Industry, and Energy, the semiconductor center would seek to draw 150 additional companies. In addition, it will be engaged in the manufacture of materials and components or the design of advanced semiconductors.
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About the Initiative
The new Samsung plants will be situated close to its current domestic manufacturing. According to Samsung, they will produce higher-margin logic chips designed to carry out a wider range of tasks and computer memory chips used for data storage.
Technology giants like the US, the EU, Japan, and China are expanding their domestic chip production in order to leverage protectionist policies, tax breaks, and subsidies to entice investors. South Korea has now made its own attempt to increase its already sizable market share.
According to President Yoon, one of South Korea’s important economic growth engines and “security and strategic assets that are also closely tied to job creation and livelihoods, is the technology sector.
Samsung and TSMC in Taiwan produce the majority of the world’s cutting-edge microchips.
In comparison to the same period in 2021, Samsung reported a significant decline in operating profit of approximately 70% in January for the last quarter of 2022. In light of Russia’s invasion of Ukraine, the corporation claimed decreased demand and “deepening uncertainty” in the global economy.
