Korean Finance Minister Choo Kyung-moo has stated that establishing an semiconductor ecosystem is crucial for enhancing the competitiveness of South Korea's semiconductor industry. To this end, the South Korean government will advance a semiconductor support plan worth over 100 trillion won, covering all aspects of the semiconductor industry, from equipment manufacturing to backend process flows.
This plan will raise funds through policy finance from the Industrial Bank of Korea, a state-owned bank, as well as through a joint fund established with contributions from the private sector and policy finance. Choo Kyung-moo referred to this as an "indirect financial support" plan, noting that it is not direct government funding but rather a combination of private and policy finance to prevent potential risks.
The South Korean government's move aims to create a semiconductor ecosystem to "compete with major countries," encompassing the entire industry chain from large enterprises like Samsung Electronics and SK hynix to small and medium-sized enterprises dealing with materials, components, and equipment. The government hopes to provide support particularly for vulnerable fabless (semiconductor design and R&D) companies among SMEs, acting as a "container" to rely on these businesses.
In addition, South Korean President Yoon Suk-yeol has announced a record support plan worth $19 billion to bolster the country's crucial semiconductor industry. This plan includes financial, infrastructure, R&D support, and assistance for SMEs, and will expand tax incentives for chip investments, hoping to promote employment and attract more talent to the industry.
The South Korean government also plans to launch a "Semiconductor Ecosystem Fund" worth 10 trillion won (approximately $7.34 billion), which will support semiconductor companies and related SMEs. This fund will help South Korea's semiconductor industry to develop and compete better.
In summary, these initiatives by the South Korean government aim to build a complete semiconductor ecosystem, enhance the competitiveness of the country's semiconductor industry, and provide support for SMEs. These efforts will help South Korea maintain its competitiveness and advantage in the global semiconductor industry.
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