The Korean government will provide 8.8 trillion won in financial support to the Korean semiconductor industry by the end of 2025. It will invest more than 2 trillion won in infrastructure construction and provide more than 4 trillion won in liquidity through Korea Development Bank. It will also unveil within this year a plan to provide  6GW of electricity to the Yongin Semiconductor Cluster.

The Korean government announced its comprehensive support plans for the semiconductor sector at a meeting of economy-related ministers held at the Government Complex in Seoul on Oct. 16. In detail, the government plans to invest 250 billion won in cash in KDB in 2025 to enable the bank to provide 4.25 trillion won in low-interest loans. The preferential interest rate will also be further lowered from the current rate by up to 1.4 percentage points. In addition, it is planning to raise an additional 42 billion won for the Semiconductor Ecosystem Fund. The fund has selected CoAsia SEMI as its first investee company. “By Oct. 11, 17 companies received 82.48 billion won in loans from KDB to finance facility investment,” it said.

The Korean government will also invest 2.4 trillion won in infrastructure, including roads and water supply. It will invest 884.3 billion won to reroute and expand Local Road 45 for reopening in 2030. Local Road 45 runs through the Yongin Semiconductor Cluster, and the road project will be exempted from a preliminary feasibility study. It will provide 1.4808 trillion won for an integrated water supply project for the semiconductor cluster. It will build a double-track pipeline through Korea Water Resources Corp. and supply water by 2031. A 3GW liquefied natural gas (LNG) power plant will also be built to ensure timely power supply. For the Yongin General Industrial Complex, it will build a power transmission line and install additional substations in the complex. It will lay out a detailed plan within this year to supply 6 GW of electric power to the semiconductor cluster.

In addition, the Korean government is planning on utilizing 1.7 trillion won of next year’s budget for the semiconductor industry. The amount is a combination of cash investments (250 billion won) and support funds for various R&D activities. A total of 5 trillion won will go to the materials, components and equipment sectors and R&D human resources development between 2025 and 2027.

The Korean government plans to expedite relevant procedures to create the Yongin Semiconductor Cluster. It also plans to actively participate in discussions on the enactment of the Special Semiconductor Law in the National Assembly. Political parties have recently proposed a series of special semiconductor laws to prepare grounds for tax, fiscal and infrastructure support and set up special committees.