South Korea said on Thursday that it would seek local sourcing for half of its semiconductor materials, components, and equipment by 2030, compared to 30% currently.
The aim of President Yoon Suk-yeol's administration to strengthen the sector is outlined in the proposal.
South Korea, home to Samsung and SK Hynix, is seeking to strengthen supply chain stability and resources to become a world class player in the industry.
In a joint statement with other ministries, the country's chip industry estimated that about 20 percent of its equipment and 50 percent of materials came from local suppliers.
High-tech, despite some self-reliance, key technologies are still heavily dependent on outside parties, according to the report, adding that the US-China trade conflict and the Russia-Ukraine conflict continued to destabilize supplies.
According to the ministry, the government and the private sector would invest KRW 300 billion (roughly Rs. 2,000 crore) in small-business innovation and in mergers and acquisitions of chip design businesses. The investment would begin next year.
South Korea will spend KR 950 billion (roughly Rs. 6,000 crore) on feasibility studies on the development of power and automobile chips from 2024 to 2030, and KR 1.25 trillion (roughly Rs. 8,000 crore) on artificial intelligence chips by 2029.
The government will look at investing in essential infrastructure, such as electricity and water supply, at places that serve as expanding chip manufacturing hubs, including Pyeongtaek and Yongin, as well as increasing tax benefits for large corporations.
According to the ministry, the private sector and government will collaborate to train at least 150,000 people over a period of ten years.
Semiconductors have been South Korea's top exports for nine years in a row. In 2021, they accounted for 19.9 percent of all exports.
2022 Thomson Reuters