The South Korean government unveiled plans to build a cluster of chipmaking facilities with the help of giant microchip producers. 

Having initially provided details to bolster the domestic chipmaking market in March 2023, the South Korean government detailed plans to construct chipmaking facilities in the Gyeonggi province. The facility will span a total area of 21km² and boast a total production capacity of 7.7M wafers per month by 2030.

The proposed project has seen major semiconductor firms such as Samsung and Sk Hynix backing the government as they seek to invest up to US$500Bn in manufacturing plants (or fabrication units) by 2047. Samsung alone intends to invest US$378Bn, which includes a US$272Bn investment into Yongin city.

South Korea is not the first country to unveil a strategy to reinforce its own chipmaking prowess. The USA, EU, and China have revealed their own plans to strengthen their position in the global semiconductor industry. The US CHIPS and Scient Act aims to bring roughly US$280Bn in funding to domestic research, the European Chips Act is set to mobilise more than US$46Bn of public and private investment, and China has poured US$50Bn into chipmaking to meet domestic demand.

South Korea’s semiconductor industry has grown by 22% y-o-y to over US$10Bn in December 2023 and is expected to reach over US$120Bn by the end of 2024. As semiconductors have been identified as being of key strategic significance, major players in the industry are backing government initiatives to bolster their dominance in the market.