South Korea Unveils Comprehensive Semiconductor Ecosystem Support Plan

TapTechNews June 26th, the Ministry of Strategy and Finance of South Korea today announced the Comprehensive Support Plan for the Semiconductor Ecosystem, aiming to enhance the overall competitiveness of South Korean semiconductor companies and ensure the country's leading position in the global semiconductor race.

The South Korean government plans to invest 2 trillion Korean won (TapTechNews note: about 10.462 billion yuan at present) in the Korea Development Bank, establish a 17 trillion Korean won (about 88.927 billion yuan at present) low-interest loan plan for semiconductor enterprises, and start providing low-interest loans to domestic semiconductor companies from July.

Compared with the general loans of the Korea Development Bank, this loan will give a 0.8 to 1.0% interest rate concession to large semiconductor enterprises; the interest rate concession for small and medium-sized enterprises is even greater, reaching 1.2 to 1.5%.

With the support of this plan, South Korean semiconductor enterprises will be able to raise operating funds at a lower cost and further develop their own businesses.

The South Korean government currently provides tax credit concessions for national strategic technology industries including semiconductors, secondary batteries, and display technologies. The specific concession ratio is 15% of facility investment and 30 to 50% of R & D investment, but the existing preferential policies will expire at the end of this year.

This Comprehensive Support Plan extends the tax credit concession to 2027, and includes advanced semiconductor materials, components, and equipment-related technologies into the subsidy category, while also including software expenses and R & D facility rentals as the base for calculating the tax credit amount.

The South Korean government aims to invest about 5 trillion Korean won (about 26.155 billion yuan at present) in semiconductor R & D, commercialization, and related human resource training from 2025 to 2027, expand AI computing infrastructure, and build a pilot line to promote the mass production of advanced semiconductors.

In addition, South Korea plans to expand the semiconductor ecosystem fund from 300 billion Korean won this year (about 1.569 billion yuan at present) to 1.1 trillion Korean won (about 5.754 billion yuan at present) starting from July, and this fund will start equity investment in fabless semiconductor design enterprises.

Finally, the South Korean government will also strengthen the investment in the infrastructure required by the semiconductor industry and upgrade the road traffic and water and power supply of the Yongin Semiconductor Cluster.