South Korea to build ‘world’s largest’ chip center with $230 billion investment from Samsung

[Get Ya Wig Split]

South Korea to build ‘world’s largest’ chip center with $230 billion investment from Samsung​

Hong Kong/SeoulCNN —
South Korea says it will build an enormous facility to make computer chips in the greater Seoul area, with about $230 billion in investment from memory chip giant Samsung Electronics.

The plans were announced by President Yoon Suk Yeol on Wednesday and confirmed by the electronics giant.

“We will build the world’s largest new ‘high-tech system semiconductor cluster’ in the Seoul Metropolitan area based on large-scale private investment of almost 300 trillion Korean won,” he said.

“In addition, we will grow the ‘semiconductor mega cluster’ to the world’s largest in connection with the existing memory semiconductor manufacturing complexes.”

A government statement said the chip cluster would be located in Gyeonggi province, which is part of the Seoul Metropolitan area, and the total investment would be completed in about 20 years.

In order to protect intellectual property, the country will revise its Industrial Technology Protection Act, according to the statement, which did not offer additional details.

Last May, Samsung (SSNLF) outlined a plan to pour more than $350 billion into its businesses and create tens of thousands of new jobs through 2026. It said it would primarily invest in core businesses such as chipmaking and biopharmaceuticals.

It wasn’t immediately clear whether the previously announced investment would overlap with the one announced Wednesday by the government.

Sanjeev Rana, a CLSA analyst, told CNN that Samsung’s investment plans over the next two decades translates into an average of about 15 trillion won annually, which is close to its existing yearly capital expenditure.

Memory chips, which have proved to be a key moneymaker for Samsung, will continue to be a focus area with further investment planned, according to the firm.

In the area of high-end computer chips, Samsung competes directly with Intel (INTC) and Taiwan’s TSMC.

The vast majority of the world’s advanced microchips are made in just two places, Taiwan and South Korea. Taiwan’s industry is larger and more dominant, something South Korea is keen to challenge.

The concentration of so much crucial chip manufacturing in just two places has caused concerns over global supply chain stability especially as South Korea and Taiwan are both militarily threatened by neighbors, North Korea and China respectively.

Over the last few years, major economies express concern about losing access to semiconductors, particularly as political and economic tension has escalated between China and the United States.

Governments, including Washington, and major companies like Apple have asked semiconductor companies to localize their operations.

“This is in line with market expectations,” he said.

Samsung is best known for its electronics division, with its popular smartphones and televisions. In recent years, the company has leaned further into its role as a provider of semiconductors as manufacturers around the world suffer from shortages.

https://edition.cnn.com/2023/03/15/tech/korea-chips-investment-hnk-intl/index.html

 

[AViet]

10 years ago, i said to my friend when i was in Korea that its economic success had a fair contribution of the threat from the North, and i still hold that view today. Without the threat from China and North Korea, both South Korea and Taiwan can easily fall into the shithole of liberalism and lose their work ethic like Japan.

Tsmc or Samsung, if moved to the US, would die, just like Carl Zeiss of Germany. Superior work ethnic and average IQ compared to American, plus the advantage of not being spoiled by liberal ideas are the formula to their current success.

 

[StraightEdge]

Well, their exports are plunging, I am not sure why they think investing more is going to help.

Source: Chip export revenue drops 41.5% on year in February (joins.com)

Their inventories are already at a record high.

The inventory-to-sales ratio of chips came to 265.7% in January, the highest since 288.7% posted in March 1997, according to the data compiled by Statistics Korea.

Source: Chips’ inventory-to-sales ratio hits near 26-year high | The Star

There is already excess investment in semi/chip plants. This is already starting to bite.

Excess inventory and capacity is already pushing revenue down.
Excess Inventory More a Drag for U.S. Chips Sector than Export Ban (fitchratings.com)

 

[Baburfromsarmarkand]

Well, their exports are plunging, I am not sure why they think investing more is going to help.

Source: Chip export revenue drops 41.5% on year in February (joins.com)

Their inventories are already at a record high.

Source: Chips’ inventory-to-sales ratio hits near 26-year high | The Star

There is already excess investment in semi/chip plants. This is already starting to bite.

Excess inventory and capacity is already pushing revenue down.
Excess Inventory More a Drag for U.S. Chips Sector than Export Ban (fitchratings.com)

Called taking calculated risks based on future trends. Chip demand will only increase as the global population grows.

 

[Ali_Baba]

South Korea to build ‘world’s largest’ chip center with $230 billion investment from Samsung​

Hong Kong/SeoulCNN —
South Korea says it will build an enormous facility to make computer chips in the greater Seoul area, with about $230 billion in investment from memory chip giant Samsung Electronics.

The plans were announced by President Yoon Suk Yeol on Wednesday and confirmed by the electronics giant.

“We will build the world’s largest new ‘high-tech system semiconductor cluster’ in the Seoul Metropolitan area based on large-scale private investment of almost 300 trillion Korean won,” he said.

“In addition, we will grow the ‘semiconductor mega cluster’ to the world’s largest in connection with the existing memory semiconductor manufacturing complexes.”

A government statement said the chip cluster would be located in Gyeonggi province, which is part of the Seoul Metropolitan area, and the total investment would be completed in about 20 years.

In order to protect intellectual property, the country will revise its Industrial Technology Protection Act, according to the statement, which did not offer additional details.

Last May, Samsung (SSNLF) outlined a plan to pour more than $350 billion into its businesses and create tens of thousands of new jobs through 2026. It said it would primarily invest in core businesses such as chipmaking and biopharmaceuticals.

It wasn’t immediately clear whether the previously announced investment would overlap with the one announced Wednesday by the government.

Sanjeev Rana, a CLSA analyst, told CNN that Samsung’s investment plans over the next two decades translates into an average of about 15 trillion won annually, which is close to its existing yearly capital expenditure.

Memory chips, which have proved to be a key moneymaker for Samsung, will continue to be a focus area with further investment planned, according to the firm.

In the area of high-end computer chips, Samsung competes directly with Intel (INTC) and Taiwan’s TSMC.

The vast majority of the world’s advanced microchips are made in just two places, Taiwan and South Korea. Taiwan’s industry is larger and more dominant, something South Korea is keen to challenge.

The concentration of so much crucial chip manufacturing in just two places has caused concerns over global supply chain stability especially as South Korea and Taiwan are both militarily threatened by neighbors, North Korea and China respectively.

Over the last few years, major economies express concern about losing access to semiconductors, particularly as political and economic tension has escalated between China and the United States.

Governments, including Washington, and major companies like Apple have asked semiconductor companies to localize their operations.

“This is in line with market expectations,” he said.

Samsung is best known for its electronics division, with its popular smartphones and televisions. In recent years, the company has leaned further into its role as a provider of semiconductors as manufacturers around the world suffer from shortages.

https://edition.cnn.com/2023/03/15/tech/korea-chips-investment-hnk-intl/index.html

Good for Korea that they have companies that can do this kind of investment in Korea !!!! Long term strategic planning by the goverment of Korea with a proper private company and goverment partnership model ( and something the UK goverment should learn from.. but they wont .. ).

Basically everyone is predicting a China/Taiwan war soon and are looking to get out of Taiwan asap by reducing their dependency on Taiwan. Food for thought for Taiwanese companies looking to off shore Taiwan as it leads to a degradation of thevalue of Taiwan and therefore less likely in intervention when China does decide to act and start a war.

If all this infra is displaced/offshored - it will hurt Taiwan economically with their ability to finance a war ...