Samsung Electronics to invest $230 bln through 2042 in South Korea chipmaking base (updated)

Samsung Electro-Mechanics

15/03/2023 04:59

(Adds Yoon statements, details; changes media slug)
    By Heekyong Yang and Joyce Lee
       SEOUL, March 15 (Reuters) - South Korean tech giant
Samsung Electronics  005930.KS  expects to invest $230 billion
over the next 20 years to develop what the country's government
called the world's largest chip-making base, in line with
efforts to boost the national chip industry.
    Samsung's around 300 trillion won project is part of a 550
trillion won private-sector investment plan unveiled by the
government on Wednesday. Seoul's strategy aims to expand tax
breaks and support to raise competitiveness of high-tech sectors
including those involving chips, displays and batteries.
    The plans come as other countries introduce steps to bolster
domestic chip industries, including the United States which last
month released details of its CHIPS Act, offering billions of
dollars in subsidies for chipmakers that invest in the country. 
    "The economic battlefield, which recently began with chips,
has expanded ... countries are providing large-scale subsidies
and tax support," said President Yoon Suk Yeol on Wednesday.
    "(We) must support private investments to ensure further
growth ... the government must provide location, R&D, manpower,
and tax support."
    Samsung's manufacturing additions will include five chip
factories and attract up to 150 materials, parts and equipment
makers, fabless chipmakers and semiconductor
research-and-development organisations near Seoul, the industry
ministry said in a statement. 
    In addition to private-sector investment, the government
will budget 25 trillion won or more over five years for R&D in
strategic technologies such as artificial intelligence. It will
provide about 360 billion won to develop chip packaging, and
about 100 billion won in electricity and water infrastructure
this year for industrial complexes. 
    In January, the government proposed raising the tax
deduction rate for facility investments in chips and other
strategic technologies from 8% to 15% for large corporations. 
    Separately, Samsung Electronics, unit Samsung Display,
affiliates Samsung SDI  006400.KS  and Samsung Electro-Mechanics
 009150.KS  said they plan to invest 60.1 trillion won in the
next 10 years in regions outside the Seoul metropolitan area to
develop chip packaging, displays and battery technology. 
    South Korea, home to the world's two biggest memory chip
makers, Samsung Electronics and SK Hynix Inc  000660.KS , is
seeking to improve supply-chain stability to become a major
player in the non-memory chip field, currently dominated by
chipmakers such as Taiwan Semiconductor Manufacturing Co Ltd
 2330.TW  and Intel Corp  INTC.O .
     
 ($1 = 1,305.1200 won)

 (Reporting by Heekyong Yang and Joyce Lee; Editing by
Christopher Cushing and Kenneth Maxwell)
 ((joyce.lee@tr.com;))