"We need to find an alternative market to China," South Korea's Deputy Prime Minister of Economy and Minister of Strategy and Finance Choi Sang-moo had said some time ago
According to reports from Yonhap News Agency and Reuters, on May 10, local time, Choi Sang-moo, Deputy Prime Minister of Economy and Minister of Planning and Finance of South Korea, announced at the Korean Food Industry Symposium semiconductors that the Korean government will promote a project worth more than 10 trillion won (about 52.7 billion yuan) to strengthen the competitiveness of the country's semiconductor industry.
Korean chips - GttyImages
Funding targets for this project include semiconductor materials, equipment manufacturers, and fabless companies. Specific measures could include the provision of political loans to businesses, and details of the program will be announced soon.
On May 10, local time, South Korea's Deputy Prime Minister and Minister of Planning and Finance Choi Sang-moo attended the symposium on the semiconductor industry. (Source: Ministry of Planning and Finance)
Yonhap news agency said that although it is not a project with direct financial support, it is the first time the Korean government has formulated a large-scale policy project for the semiconductor industry.
This move aims to "compete with major countries".
Bloomberg said the move comes as the U.S. government is pressuring South Korea to limit the flow of equipment and technologies used to make high-end logic and memory chips to China.
Reuters pointed out that South Korea has set its sights on the semiconductor industry "war" and hopes to win.
Choi Sang-moo described this program as "indirect financial support," in which the government does not directly invest in funds, but private and political financial funds come into play together, and "financial support can prevent potential risks."
He added that the Korean government wants to provide support to small and medium-sized enterprises, especially vulnerable fabless (semiconductor design and development) companies, and wants to be a "vessel" for these companies to rely on.
Choi Sang-moo had previously said, "We need to find an alternative market to China."
The Yonhap news agency said the Korean government's move is aimed at creating a semiconductor ecosystem that can "compete with major countries," covering the entire industrial chain, from large companies such as Samsung Electronics and SK Hynix to small and medium-sized enterprises such as those that produce materials, components and equipment.
This latest plan announced by the South Korean Finance Minister is reminiscent of the Vanguard Industrial Fund mentioned by South Korea's Minister of Industry, Trade and Resources Ahn Deok-geun on May 7.
In this regard, Choi Sang-mu pointed out that the two funds are "slightly different": the Vanguard Industrial Fund issues bonds and the government provides guarantees, but the procedure is very strict, for example, the government's annual guarantee must be approved by the National Assembly.W"
On the day of the symposium, Korean semiconductor companies suggested that the government extend the period of the tax credit for domestic strategic technologies and expand the scope of the credit, expand support for cutting-edge industrial infrastructure, narrow the financing gap between local and foreign enterprises, cultivate and protect core technology, and cultivate and support local semiconductor equipment enterprises.
Choi Sang-moo said he will actively discuss with the National Assembly the extension of the tax exemption period for domestic strategic technologies and examine which sectors need to be added to the scope of the exemption.
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