Samsung wants to increase its investments in chip technology

The South Korean electronics giant Samsung wants to increase its investments in chip technology billions in view of the global shortage of semiconductors. By 2030, 171 trillion won (around 125 billion euros) will be invested in the business with modern chip processors and contract manufacturing (foundry), as announced by the world's largest manufacturer of memory chips. South Korea's government announced major tax breaks and loan aid to support the domestic chip industry's investment plans. With the higher expenditure, Samsung Electronics wants to accelerate research in the field of processor technology and the construction of new production facilities. Samsung originally announced investments of 133 trillion won in April 2019. The South Koreans have set themselves the goal of expanding their market leadership for memory chips, such as those used in smartphones, to include so-called logic chips by the end of this decade. To this end, Samsung has worked with various semiconductor design companies, parts manufacturers and equipment suppliers, and research institutes over the past two years, it said. The company also claims to have started building a new production line in its manufacturing complex in the city of Pyeongtaek, about 65 kilometers south of Seoul. The plant is scheduled to be completed in the second half of 2022. Other large chip companies such as the industry leader Intel in the USA and TSMC in Taiwan also want to significantly expand their capacities with further billions in investments. The shortage was also triggered by the skyrocketing demand for technology such as laptops in the corona pandemic. South Korea must consolidate its leading position in memory chips and become number one in system semiconductors, said President Moon Jae In during a visit to the Samsung production site in Pyeongtaek. This is the only way for the country to achieve its goal of "becoming a semiconductor power center by 2030". According to Moon, the South Korean chip companies including Samsung and Sk hynix plan to invest 510 trillion won or more over the next ten years. "The semiconductor industry has moved beyond inter-company competition to an era of inter-country competition." In order to cope with the reorganization of the global supply chains, the government will offer support such as tax breaks at the national level. Among other things, tax reductions of up to 50 percent for research and development and up to 20 percent for capital investments are planned by 2024. More than a trillion won will be made available for loans at low interest rates for capital investments. According to the government's plans, the "K (orea) semiconductor belt" is to be built in the western part of the country, including Pyeongtaek. This is intended to encompass the entire scope of the semiconductor business including manufacturing, materials and design.