Samsung to invest $230 billion in new semiconductor facilities in South Korea

Samsung Electronics recently announced its plans to invest $230 billion in five new fabrication facilities in Yongin, South Korea, as part of the government's initiative to establish a mega semiconductor hub in the region.

The new factories will have mixed foundry and memory manufacturing purposes, indicating Samsung's commitment to expanding its operations in the country. The Ministry of Trade, Industry and Energy (MOTIE) in South Korea has pledged to invest $422 billion by 2026 to boost the production of six core technologies, including semiconductors, electric vehicle batteries, autonomous vehicles, robots, and displays. The government has allocated $260 billion of the total budget to develop system semiconductors until 2026, reflecting its commitment to strengthening its domestic semiconductor production line.

With the global supply chains facing recent fluctuations due to the pandemic and rising tensions between political giants, countries such as China, Taiwan, Japan, and the United States are also boosting their domestic chip manufacturing efforts. South Korea's aim to foster high-tech industries in the proposed mega hub region is a step towards safeguarding its internal supply chains and staying competitive with similar efforts around the world.

The government's plan includes offering expanded tax breaks to attract corporations in the native advanced technology space. Samsung, which has been expanding its foreign operations, including the in-progress North American semiconductor fabrication facility located in Taylor, Texas, has ample budget and time to make its own choices. However, local government incentives could potentially result in a slowdown of Samsung's overseas efforts in the long term.