Proposed ban on new chip clusters in capital area raises concerns

The government’s plan to deny support for additional semiconductor industrial complexes in Seoul and surrounding Gyeonggi Province is fueling concerns that it may undermine a chip cluster under construction in Yongin, Gyeonggi Province, backed by a combined 1,000 trillion won ($670 billion) investment from Samsung Electronics and SK hynix. Although the Yongin cluster will remain eligible for previously promised support, the new plan triggers suspicions that the government may encourage partner companies in the cluster to relocate to noncapital regions. According to the Ministry of Trade, Industry and Resources, the government is set to announce the enforcement decree of the Special Act on Strengthening Competitiveness and Supporting the Semiconductor Industry later this month. The decree will stipulate that semiconductor industrial complexes built in Seoul, Incheon and Gyeonggi Province cannot be designated as “chip clusters” eligible for state support for electricity, water and roads. The announcement follows the passage of the act in January. The law, which will take effect Aug.

Original source: Korea Times