South Korea Announces Major Financial Boost for Semiconductor Industry with 8.8 Trillion Won Support by 2025

SEOUL: South Korea is set to allocate 8.8 trillion won (approximately US$6.45 billion) in financial support to bolster its semiconductor industry by 2025. This initiative, announced by the Ministry of Economy and Finance, aims to enhance the sector's competitiveness through low-interest loans and targeted funding as the global competition in chip manufacturing intensifies. According to Yonhap News Agency, the funding is a part of a larger 26 trillion won support package unveiled by President Yoon Suk Yeol last June, which focuses on reinforcing South Korea's key industries. The financial aid will be distributed in various forms, including 4.7 trillion won in loans and funding specifically designed to support fabless and chip material companies. This strategy is expected to strengthen the overall industry ecosystem. Additionally, the government plans to allocate 1.7 trillion won next year for extensive research and development efforts. These projects will concentrate on securing cutting-edge technologies in areas such as chip clouding and packaging. The initiative will also include programs aimed at nurturing talent within the industry. A significant portion of the support, amounting to 2.4 trillion won, will be used for infrastructure development for a planned semiconductor cluster in Yongin, Gyeonggi Province. This site is expected to become the world's largest chip cluster, with major companies like Samsung Electronics Co. and SK hynix Inc. planning to invest a total of 622 trillion won to construct 16 new fabrication plants. Finance Minister Choi Sang-mok emphasized the government's commitment to the semiconductor industry during an economy-related ministers' meeting. "The government will best support the chip industry so as for chipmakers to lead the global market," Choi stated. He also mentioned the government's active role in legislative discussions for special laws dedicated to the semiconductor sector and measures to protect startups from technology theft.