Samsung Electronics and SK hynix are set to establish a massive, unprecedented semiconductor cluster in the Gwangju and Jeonnam region, marking the first time an ultra-large production complex encompassing both core front-end fabrication facilities (fabs) and back-end processes will be built outside the Seoul metropolitan area. According to political and business sources, SK Group Chairman Chey Tae-won is scheduled to officially unveil the Gwangju-Jeonnam Semiconductor Cluster initiative on June 30, coinciding with the launch of the integrated Jeonnam-Gwangju Metropolitan City on July 1. This initiative, centered on semiconductors and artificial intelligence (AI) data centers, represents a shift from initial expectations that focused solely on back-end packaging, as the decision has been made to construct comprehensive front-end fabs where fine circuits are etched onto wafers. Chey reportedly presented this large-scale regional investment roadmap to President Lee Jae-myung during a recent meeting, and Samsung Electronics Chairman Lee Jae-yong is also expected to hold a closed-door meeting with the president to finalize his company's specific regional investment volumes. Given that the semiconductor industry estimates the construction of a single new front-end fab requires more than 100 trillion KRW, and with Samsung Electronics actively reviewing a fab construction in Gwangju, projections suggest the combined total investment from both tech giants could comfortably exceed 200 trillion KRW, and potentially scale much higher as infrastructure is built entirely from scratch. This historic investment decision stems from a combination of surging global demand for AI semiconductors, the severe physical limitations regarding power transmission and industrial water supply facing existing metropolitan clusters like Yongin and Pyeongtaek, and aggressive lobbying by local governments coupled with central government policy support aimed at preventing regional economic decline. Front-end operations are highly demanding as they require the concurrent relocation of hundreds of material, parts, and equipment suppliers alongside highly skilled engineers capable of handling complex machinery, which is why both firms have historically kept their advanced domestic facilities strictly within the capital region. This Gwangju-Jeonnam announcement is expected to kickstart a wave of major private-sector regional investments, with Samsung Electronics Chairman Lee Jae-yong widely anticipated to visit the Cheonan campus in Chungnam early next month to announce an AI data center for the Chungcheong region, followed by the unveiling of a space and aviation industry ecosystem in the Gyeongsang region in early July. Despite the economic promise, the Gwangju semiconductor project faces significant hurdles, particularly regarding the attraction of top-tier talent, securing a robust local components ecosystem, and the potential five to ten years required to fully optimize manufacturing yields. The initiative has also sparked domestic political friction, with Reform New Party leader Lee Jun-seok publicly criticizing the moves on social media, claiming the administration is forcing the conglomerates to invest in the Honam region and warning that such political risk drives the "Korea discount" that global investors dislike. To address these complex practical challenges, the presidential office is hosting a working-level roundtable on regional investment featuring senior conglomerate executives, including Samsung Electronics' Device Solutions head Jeon Young-hyun, where participants are expected to brief the government on urgent on-the-ground needs such as expanding regional power and water infrastructure, implementing stronger tax incentives, and establishing dedicated measures to secure and retain local engineering talent (ICE SEOUL)

Fonte notizia: Dong-A Business Review