Seoul: The government on Wednesday unveiled a comprehensive strategy for the country to become a top two global player in the semiconductor industry by creating the world's largest chip cluster. In the vision announced by Industry Minister Kim Jung-kwan, the government said South Korea will spend a combined 700 trillion won (US$476 billion) by 2047 on building 10 new semiconductor fabrication plants to make Korea the world's largest chip production hub, according to the Ministry of Trade, Industry and Resources.
According to Yonhap News Agency, the road map was shared at an intergovernmental meeting on fostering the Korean semiconductor industry, presided over by President Lee Jae Myung and attended by major chipmakers and artificial intelligence (AI) startups, including Samsung Electronics Co., SK hynix Inc., and FuriosaAI. Under the plan, the government also plans to invest 215.9 billion won by 2032 in developing next-generation memory chip technologies, such as neural processing units (NPUs) and processing in memory (PIM).
The technologies are expected to allow more advanced AI inference capabilities than the high-bandwidth memory (HBM), according to the ministry. The government will funnel 1.27 trillion won into developing semiconductors optimized for AI over the next five years, another 260.1 billion won by 2031 into compound semiconductors, and 360.6 billion won by 2031 into advanced packaging technologies.
The road map also includes a plan to bolster Korea's capabilities in system semiconductor, an area the country shows relatively weak competitiveness, by fostering a collaborative ecosystem in which demand-side companies join hands with fabless companies to develop on-device AI technologies and homegrown technologies for middle-tech semiconductors. Middle-tech semiconductors refer to chips that are not as advanced as AI chips but still require advanced engineering, like microcontroller units for automobiles and power management integrated chips, according to the ministry.
To help the local industry domestically fabricate middle-tech chips, the government and the private sector will jointly establish the nation's first "cooperative foundry" to allocate dedicated production capacity for Korean fabless firms. The ministry said the country will also work to bolster the competitiveness of the materials, parts, and equipment for the semiconductor industry, while training advanced talent to lead the sector.
In detail, the government will begin a project to build the nation's first mass-production test bed for materials, parts, and equipment linked to chip manufacturing, with an aim to fully operate the facility in 2027. For talent fostering, it plans to expand graduate schools specializing in semiconductors to 10 by 2030 from the current number of six.
Last week, the industry ministry also signed an initial agreement with British semiconductor design company Arm to launch a project to train 1,400 chip design specialists in Korea. Meanwhile, the government said it plans to align the semiconductor initiative with its plan to promote balanced regional development, making the southwestern city of Gwangju a special cluster for advanced chip packaging, the southeastern city of Busan a zone for power semiconductors, and Gumi a cluster for semiconductor materials and parts.
"To win the global semiconductor race, we must marshal the full strength of our nation," the industry minister said. "In areas where we excel, such as semiconductor manufacturing, we will provide comprehensive support for corporate investment to maintain a world-leading gap," he added. Kim said the government will also work to boost the competitiveness of the system semiconductor sector, while expanding the fabless capacity tenfold.