▲ Industry Minister Kim Jung-kwan announces semiconductor investment projects during an investment briefing meeting chaired by President Lee Jae Myung at Cheong Wa Dae in Seoul on June 29, 2026. (Pool photo) (Yonhap)
▲ President Lee Jae Myung presides over a meeting to unveil the government's three mega projects aimed at attracting large-scale investment in semiconductors, physical artificial intelligence (AI) and AI data centers at Cheong Wa Dae in Seoul on June 29, 2026. (Pool photo) (Yonhap)

(LEAD) S Korea-chip investment

(LEAD) S. Korea to build semiconductor cluster in southwestern region with 800 tln won in corporate investment

(ATTN: UPDATES with more details throughout; ADDS photo)

By Kim Eun-jung

SEOUL, June 29 (Yonhap) -- South Korea plans to develop a new semiconductor production base in the country's southwestern region through 800 trillion won (US$517.9 billion) in corporate investments that will create four memory chip fabrication plants, Industry Minister Kim Jung-kwan said Monday.

Kim unveiled the investment plan to transform the Gwangju and Jeolla regions into the nation's second major semiconductor cluster, alongside the existing hub in the Seoul metropolitan area, during a national investment briefing chaired by President Lee Jae Myung at Cheong Wa Dae.

"Relying on a single production base in the Seoul metropolitan area is no longer sufficient to meet surging semiconductor demand," Kim said, noting that constraints on power and water resources limit further expansion under existing plans.

The semiconductor investment is part of the government's "three mega projects" initiative, which calls for large-scale investments by chip giants Samsung Electronics Co. and SK hynix Inc., as well as other companies, in semiconductors, physical artificial intelligence (AI) and AI data centers.

Kim said the Chungcheong region will be developed into an advanced semiconductor packaging hub through 81 trillion won in investment to meet growing packaging demand as chip production expands, while the Daegu and North Gyeongsang regions will be fostered as innovation hubs for semiconductor materials, components and equipment.

He added that the government will help companies accelerate semiconductor investment by bringing forward the construction schedule for new fabrication plants by as much as 12 years, from the mid-to-late 2040s to the mid-2030s.

To support the expansion, the government vowed to streamline permits and construction procedures while investing in critical infrastructure, including electricity and industrial water supplies.

At the meeting, attended by Samsung Electronics Chairman Lee Jae-yong and SK Group Chairman Chey Tae-won, Kim outlined a government-industry plan to invest 30 trillion won (US$19.4 billion) over the next 15 years to support the entire semiconductor value chain, from research and development and chip design to testing and manufacturing.

The ambitious industrial blueprint is aimed at transforming the country from a global manufacturing powerhouse into a leader in the artificial intelligence era, anchoring its strategy on semiconductors, AI infrastructure and physical AI.

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