The Korea Semiconductor Industry Association has asked the South Korean government to pass new laws that would benefit the chip industry. The organization has essentially asked for the government’s support through new regulations.
According to TheElec report, the association, in an open letter, stated that the US was planning on offering up to 40 percent tax reduction for semiconductor equipment expenditure, which is similar to the European Unions plans of offering a 67 trillion won project to help boost its local semiconductor production. In other words, the South Korean chip industry is basically asking for similar incentives to keep up with the foreign competition.
In 2020, the local semiconductor in South Korea accounted for an 18.4 percent market share, which was second only to the US. In terms of memory semiconductors, the region accounted for 56.9 percent of the market share, leading the global market. Semiconductor export accounted for 19.4 percent of South Korea’s total, with the equipment spending in chips locally accounting for over 40 percent of the total in the manufacturing sector overall.
In simpler terms, the industry is one of the pillar’s of South Korea’s economy, although, it is facing various challenges and hurdles ahead. Thus, the KSIA urged the government to offer up to 50 percent tax reduction in related research, development, and equipment spending. Additionally, chip based firms should also get support in approval to build new faculties, water supply, and other infrastructures as well, while universities in Seoul should open more majors related to semiconductors to recruit local talents, as per the organization.
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