South Korea plans to provide tax incentives and state subsidies to chipmakers to encourage them to spend $453 billion by 2030, in line with its vision to become a global powerhouse in both memory and non-memory chips.
Under the plan dubbed the K-semiconductor blueprint, the government will also draw up a 1.5 trillion-won budget to support the development of next-generation power semiconductors and AI chips, according to the Ministry of Trade, Industry and Energy.
Another batch of 1 trillion won worth of low-interest loans will be provided to support facility investment by local chipmakers, including 8-inch wafer foundry lines. South Korea is home to leading global players including Samsung Electronics and SK Hynix.
The 510 trillion-won ($453 billion) investment plan includes 41.8 trillion won in investment estimated for 2021.
Aided by a set of supporting measures, South Korea aims to more than double its annual outbound shipments of chips to reach a whopping $200 billion in 2030 from $99.2 billion tallied in 2020, reports Yonhap news agency.
The government will designate semiconductors as a “national innovation strategy technology” and increase tax benefits to as much as six times the current level, President Moon Jae-in said.
The semiconductor sector has been the key driver of the country’s exports, taking up around 20 percent of the country’s annual outbound shipments.
Exports of chips advanced 30.2 percent on-year in April to $9.3 billion, extending their gains to 10 consecutive months.
South Korea, however, has been lagging behind global peers in terms of non-memory chips. To induce chipmakers to carry out scheduled investment plans, the country said it will offer various tax benefits and subsidies.