South Korea plans to bolster its fiscal support for domestic chipmakers next year, shoring up an industry that might face unfavorable policies from the incoming administration of US president-elect Donald Trump and more intense challenges from Chinese rivals.
Financial support made up of loans, insurances and guarantees from state-affiliated organizations is set to amount to 14.3 trillion won (US$10.3 billion) next year in an elevation of continued policy stimulus, the South Korean Ministry of Economy and Finance said yesterday.
Separately, the government plans to cover “a significant share” of the 1.8 trillion won needed to bury power cables in chipmaking clusters south of Seoul, it said in a statement.
Photo: Bloomberg
South Korea had already launched a 26 trillion won aid package in July, part of which would be reflected in next year’s support amount.
Separately, the government would seek to increase the tax credit rate for semiconductor-related firms by 10 percentage points and build a national “artificial intelligence computing center” worth 4 trillion won by 2030, it said yesterday.
South Korea is stepping up its support for the crown jewel of its economy at a time when Trump vows to bolster US manufacturing and reduce reliance on foreign supply chains.
While the nation has continued to funnel fiscal support into chipmakers, Trump’s election has added urgency to safeguarding the growth of the industry.
In its statement the ministry said there is potential for economic uncertainties to grow after the new US administration is inaugurated, even though US-South Korean ties in defense and shipbuilding could still benefit.
South Korea’s biggest company, Samsung Electronics Co, in particular is building a semiconductor factory in Texas with subsidies promised under the CHIPS Act of the outgoing administration of US President Joe Biden. Trump’s camp repeatedly criticized that funding program during the election campaign.
China might also ratchet up its pursuit of South Korea in supply chains, raising the need for Seoul to help shore up the competitiveness of its tech industries, the finance ministry said, adding that a rising wave of protectionist policies might also dent South Korea’s trade-reliant economy.
Technology exports account for roughly one-third of South Korea’s shipments abroad.
The economy is expected to be on course to grow at least 2 percent this year compared with last year, particularly on the back of strong demand for semiconductors, including memory chips used in artificial intelligence development.
Forecasts among economists for next year are turning less optimistic since the export rally has softened in recent months.
Officials also worry Trump could get tougher on US trading partners after he assumes office in January.
Apple Inc increased iPhone production in India by about 53 percent last year and now makes a quarter of its marquee devices there, reflecting the US company’s efforts to avoid tariffs on China. The company assembled about 55 million iPhones in India last year, up from 36 million a year earlier, people familiar with the matter said, asking not to be named because the numbers aren’t public. Apple makes about 220 million to 230 million iPhones a year globally, with India’s share of the total increasing rapidly. Apple has accelerated its expansion in the world’s most populous country in recent years, bolstered
DAMAGE REPORT: Global central banks are assessing war-driven inflation risks as the law of unintended consequences careens around the world, spiking oil prices Central banks from Washington to London and from Jakarta to Taipei are about to make their first assessments of economic damage after more than two weeks of conflict between the US and Iran. Decisions this week encompassing every member of the G7 and eight of the world’s 10 most-traded currency jurisdictions are likely to confirm to investors that the specter of a new inflation shock is already worrying enough to prompt heightened caution. The US Federal Reserve is widely expected to do exactly what everyone anticipated weeks ahead of its March 17-18 policy gathering: hold rates steady. The narrative surrounding that
Taiwan Semiconductor Manufacturing Co’s (TSMC, 台積電) share of the global foundry market rose to almost 70 percent last year amid booming demand for artificial intelligence (AI), market information advisory firm TrendForce Corp (集邦科技) said on Thursday. The contract chipmaker posted US$122.54 billion in revenue, up 36.1 percent from a year earlier, accounting for 69.9 percent of the global market, TrendForce said. Its share was up from 64.4 percent in 2024, it said. TSMC’s closest rival, Samsung Electronics, was a distant second, posting US$12.63 billion in sales, down 3.9 percent from a year earlier, for a 7.2 percent share of the global market. In the
HEADWINDS: The company said it expects its computer business, as well as consumer electronics and communications segments to see revenue declines due to seasonality Pegatron Corp (和碩) yesterday said it aims to grow its artificial intelligence (AI) server revenue more than 10-fold this year from last year, driven by orders from neocloud solutions clients and large cloud service providers. The electronics manufacturing service provider said AI server revenue growth would be driven primarily by the Nvidia Corp GB300 server platform. Server shipments are expected to increase each quarter this year, with the second half likely to outperform the first half, it said. The AI server market is expected to broaden this year as more inference applications emerge, which would drive demand for system-on-chip, application-specific integrated circuits
RSS