Samsung To Invest $230 Billion To Build "mega" Chip Cluster

Samsung Electronics said on Wednesday it plans to invest 300 trillion won ($230 billion) over the next 20 years in an ambitious South Korean national project to build the world's largest semiconductor manufacturing base near the capital, Seoul. .

By 2042, Gyeonggi Province will have a "mega-cluster" of chip manufacturing, including five new semiconductor factories built by Samsung. According to South Korea's Ministry of Trade, Industry and Energy, it will aim to attract another 150 companies that produce materials and components or develop high-tech chips.

The company said Samsung's new factories will be located near existing domestic factories and will produce computer memory chips used for data storage and high-efficiency logic chips designed for a wide range of functions.

Samsung, a giant in the global memory industry, is trying to expand its footprint in edge chips and expects demand to grow in the coming years with the introduction of new technologies such as networking. 5G wireless, artificial intelligence and self-driving cars. .

The semiconductor group is part of a wider government plan, announced on Wednesday, to develop six key technology industries it sees as the most important to the country's export-dependent economy. In addition to semiconductors, these include batteries, electric vehicles, robotics, displays and biotechnology. The government hopes to attract 550 trillion won ($422 million) of corporate investment in these projects by 2026.

South Korea's plan comes at a time when other tech powers, including the United States, Japan and China, are ramping up domestic chip production, implementing protectionist measures, cutting taxes and handing out huge subsidies to attracted investment. In a meeting with economic policymakers and business leaders on Wednesday, South Korean President Yoon Seok-yul called the technology industry "the country's main engine of economic growth as well as a security asset." and strategic directly related to the creation of jobs and livelihoods".

"(South Korea) has world-class manufacturing capabilities and technology in various high-tech industries such as semiconductors, secondary batteries and display screens, but (government) support rules and conditions have been insufficient," the Department of Trade in a statement.

Profits at Samsung, South Korea's biggest company, have fallen sharply in recent months due to a weak global economy hit by Russia's war with Ukraine and rising inflation, which has dampened demand for its electronics. consumables and memory chips. The company's profit fell nearly 70% in the three months to December as chip prices fell as customers adjusted inventory to reflect economic uncertainty.

SK Hynix, another major South Korean chipmaker, posted an operating loss of 1.7 trillion won ($1.3 billion) for the October-December period, its first quarterly loss since 2012.

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