On Thursday, the South Korean government announced that it would be creating seven “specialized complexes” in major cities across the country in order to promote private investment and foster the growth of advanced sectors. Five additional complexes were also designated for materials, parts, and equipment for key industries.
The complexes for the chip industry will be located in Yongin and Pyeongtaek, while the secondary battery complexes will be based in Cheongju, Pohang, Saemangeum, and Ulsan. The display sector will have complexes in the Cheonan and Asan areas. Private companies have agreed to invest a total of 614 trillion won (US$485.1 billion) in these complexes by 2026.
For example, the Yongin and Pyeongtaek complexes will be used to support 56.2 billion won of investment in memory and system semiconductors by Samsung Electronics Co., SK hynix Inc., and other chipmakers by 2042. The Gumi complex will be a major base for core semiconductor components, such as silicon wafer and substrates. SK Siltron Co., LG Innotek Co., and other firms have agreed to invest a combined 4.7 trillion won in the complex by 2026.
The four battery industry complexes are meant to create a value chain from minerals processing to supplying cathode materials, producing cells, and recycling, as well as to develop next-generation batteries. Major battery makers, including LG Energy Solution Ltd., LG Chem Ltd., SK On Co., and POSCO Future M Co., have agreed to invest a combined 30 trillion won in these complexes by 2027.
The Cheonan and Asan complexes will be used by Samsung Display Co. and other smaller firms to make an investment worth 17.2 trillion won by 2026.
The government has promised to provide tailored, comprehensive support to companies in the complexes, including removing tricky regulations, offering tax cuts, and providing infrastructure and administrative support.
In addition, eight universities, including Seoul National University and Pusan National University, were designated as leading institutions to nurture talent for the advanced, strategic industries. These universities will receive a total of 54 billion won in state funds in 2023 alone.
Five additional special complexes for materials, equipment, and components for semiconductors, biopharmaceuticals, and future vehicles were designated in Gwangju, Daegu, Osong, Busan, and Anseong. Companies have agreed to invest 6.7 trillion won in these complexes.
In February 2021, the government had already designated five specialized industry complexes in Yongin, Cheongju, and other regions across the country.