{"id":2205229,"date":"2024-05-24T08:00:19","date_gmt":"2024-05-23T23:00:19","guid":{"rendered":"https:\/\/koreapro.org\/?p=2205229"},"modified":"2024-05-23T21:18:41","modified_gmt":"2024-05-23T12:18:41","slug":"south-koreas-chip-industry-faces-uphill-battle-despite-massive-support-package","status":"publish","type":"post","link":"https:\/\/koreapro.org\/2024\/05\/south-koreas-chip-industry-faces-uphill-battle-despite-massive-support-package\/","title":{"rendered":"South Korea\u2019s chip industry faces uphill battle despite massive support package"},"content":{"rendered":"

South Korea unveiled a $19 billion (26 trillion won) <\/span>support package<\/span><\/a> for its semiconductor industry on Thursday, aimed at bolstering the country\u2019s position in the global chip market. The package includes financial programs, research and development (R&D) initiatives and infrastructure support for various industry players, with a significant portion allocated to infrastructure investment through the state-run Korea Development Bank.<\/span><\/p>\n

South Korean President Yoon Suk-yeol emphasized during an interagency meeting on economic issues that the package will focus on supporting the entire semiconductor supply chain, particularly small and medium-sized enterprises (SMEs). The government plans to extend tax breaks, expedite administrative procedures for the semiconductor mega cluster project in Gyeonggi Province and invest in nurturing talent for R&D projects. Detailed supportive measures will be finalized by next month, with plans for the system semiconductor field available by August.<\/span><\/p>\n

Why It Matters<\/b><\/p>\n

South Korea\u2019s $19 billion semiconductor support package aims to bolster the country\u2019s position in the global chip market. However, the package does not directly address several key challenges, such as the country\u2019s <\/span>declining global chip market share<\/span><\/a>, competition from aggressive <\/span>reshoring efforts<\/span><\/a> by the U.S. and the <\/span>shortage of skilled workers<\/span><\/a> in the sector.<\/span><\/p>\n

The success of the semiconductor mega cluster also hinges on the availability of reliable power sources. Yoon\u2019s preference for <\/span>nuclear energy<\/span><\/a> will face opposition from the Democratic Party, which could retake the presidency in 2027, leading to policy uncertainties.<\/span><\/p>\n

Moreover, the support package specified $3.7 billion (5 trillion won) for R&D investment in the chip sector from 2025 through 2027. However, this is less substantial compared to Taiwan\u2019s approach. TSMC alone spent $5.7 billion (<\/span>NT$182 billion<\/span><\/a>) on R&D in 2023, concentrating on improving manufacturing processes and component capabilities.<\/span><\/p>\n

Additionally, the Taiwanese government offers <\/span>tax incentives<\/span><\/a> for companies that invest at least $186 million (NT$6 billion) in R&D and allocate at least 6% of their revenue to R&D. This focused approach, coupled with government support, may give Taiwanese companies a competitive edge over their South Korean counterparts.<\/span><\/p>\n

Business & Economy<\/span><\/a>Domestic Politics<\/span><\/a>Inter-Korean & Foreign Relations<\/span><\/a>Technology & Cyber<\/span><\/a><\/div>","protected":false},"excerpt":{"rendered":"

South Korea unveiled a $19 billion (26 trillion won) support package for its semiconductor industry on Thursday, aimed at bolstering the country\u2019s position in the global chip market. The package includes financial programs, research and development (R&D) initiatives and infrastructure support for various industry players, with a significant portion allocated to infrastructure investment through the […]<\/p>\n","protected":false},"author":10407,"featured_media":2205230,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[30],"tags":[24,27,28,29],"class_list":["post-2205229","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-briefings","tag-business-economy","tag-domestic-politics","tag-inter-korean-foreign-relations","tag-technology-cyber"],"yoast_head":"\nSouth Korea\u2019s chip industry faces uphill battle despite massive support package - KOREA PRO<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/koreapro.org\/2024\/05\/south-koreas-chip-industry-faces-uphill-battle-despite-massive-support-package\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"South Korea\u2019s chip industry faces uphill battle despite massive support package - KOREA PRO\" \/>\n<meta property=\"og:description\" content=\"South Korea unveiled a $19 billion (26 trillion won) support package for its semiconductor industry on Thursday, aimed at bolstering the country\u2019s position in the global chip market. The package includes financial programs, research and development (R&D) initiatives and infrastructure support for various industry players, with a significant portion allocated to infrastructure investment through the […]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/koreapro.org\/2024\/05\/south-koreas-chip-industry-faces-uphill-battle-despite-massive-support-package\/\" \/>\n<meta property=\"og:site_name\" content=\"KOREA PRO\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/nknewsorg\/\" \/>\n<meta property=\"article:published_time\" content=\"2024-05-23T23:00:19+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2024-05-23T12:18:41+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/koreapro.org\/wp-content\/uploads\/sites\/6\/2024\/05\/eb-12.png\" \/>\n\t<meta property=\"og:image:width\" content=\"1870\" \/>\n\t<meta property=\"og:image:height\" content=\"1000\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/png\" \/>\n<meta name=\"author\" content=\"johnleenknews\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@southkoreapro\" \/>\n<meta name=\"twitter:site\" content=\"@southkoreapro\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"KOREA PRO\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/koreapro.org\/2024\/05\/south-koreas-chip-industry-faces-uphill-battle-despite-massive-support-package\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/koreapro.org\/2024\/05\/south-koreas-chip-industry-faces-uphill-battle-despite-massive-support-package\/\"},\"author\":{\"name\":\"johnleenknews\",\"@id\":\"https:\/\/koreapro.org\/#\/schema\/person\/b9766dba611638edc06a6e0b7078714d\"},\"headline\":\"South Korea\u2019s chip industry faces uphill battle despite massive support package\",\"datePublished\":\"2024-05-23T23:00:19+00:00\",\"dateModified\":\"2024-05-23T12:18:41+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/koreapro.org\/2024\/05\/south-koreas-chip-industry-faces-uphill-battle-despite-massive-support-package\/\"},\"wordCount\":348,\"publisher\":{\"@id\":\"https:\/\/koreapro.org\/#organization\"},\"image\":{\"@id\":\"https:\/\/koreapro.org\/2024\/05\/south-koreas-chip-industry-faces-uphill-battle-despite-massive-support-package\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/assets.korearisk.com\/uploads\/sites\/6\/2024\/05\/eb-12.png\",\"keywords\":[\"Business & Economy\",\"Domestic Politics\",\"Inter-Korean & Foreign Relations\",\"Technology & Cyber\"],\"articleSection\":[\"Briefings\"],\"inLanguage\":\"en-US\"},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/koreapro.org\/2024\/05\/south-koreas-chip-industry-faces-uphill-battle-despite-massive-support-package\/\",\"url\":\"https:\/\/koreapro.org\/2024\/05\/south-koreas-chip-industry-faces-uphill-battle-despite-massive-support-package\/\",\"name\":\"South Korea\u2019s chip industry faces uphill battle despite massive support package - 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