Aiming to cement South Korea's dominant position in the global semiconductors supply chain, the government on Thursday unveiled its so-called "K-Semiconductor Belt Strategy".
The strategy will see a large scale investment from private firms with tax breaks and financial and infrastructure support coming from the government.
"Our country's semiconductor firms will create the world's biggest chip supply chain in South Korea over the next ten years through injecting more than 451 billion U.S. dollars. In return, the government has come up with a large scale support package."
Among those firms, Samsung Electronics intends to invest more than 151 billion U.S. dollars in system semiconductors, and SK hynix will also expand its investment.
Key to the plan is a semiconductor cluster connecting three strips of facilities across the country to create a K-shape.
The belt will encompass foundry manufacturing, materials and components production, as well as fabless manufacturing and packaging,reducing the country's dependency in all areas of the production process.
Another pillar of the strategy is to drastically expand investment and tax incentives for the semiconductor sector.
That includes tax breaks of up to 50 percent for research and development and 20 percent for facility investment for both SMEs and conglomerates.
For facility investment, around 9-hundred million U.S. dollars has been set aside for prime-rate loans.
10 years' worth of water used at Yongin and Pyeongtaek, within the chip cluster, has been secured and the government aims to shoulder half the cost of the electricity used at the facilities.
The plan also includes training around 36-thousand more skilled personnel in the chip industry over the next ten years by expanding the related university and masters courses and class quotas.
Coming up with a long term roadmap for strengthening the supply of automotive chips is also part of the plan.
Through the "K-Semiconductor Belt Strategy", the country is aiming to double chip exports within ten years.
It is also expected to create around 100-thousand new jobs in the country.
Kim Sung-min, Arirang News.