The South Korean government is in discussions with Samsung Electronics and SK Hynix regarding plans for the next phase of large-scale investment in semiconductor production facilities.
During the meeting, South Korean authorities also requested that the two companies accelerate the construction progress of existing new chip factories.
The South Korean government is considering the Hamgyong region as a potential site for a second semiconductor industry cluster, in order to alleviate the excessive concentration of the existing cluster and expand room for growth.
On June 24, the South Korean government stated on Wednesday (June 24) that it is in consultations with Samsung Electronics and SK Hynix on plans for the next phase of large-scale investment in semiconductor production facilities, and said it will soon announce news related to a new chip industry cluster.
Kim Yong-beom, a policy adviser to the South Korean president, said at a discussion meeting that chip demand is growing at an exponential and explosive rate driven by the artificial intelligence industry, which may require the two companies to accelerate the construction progress of new chip factories.
In addition, the discussion also covered the location of new factories for South Korea’s second semiconductor cluster as well as supporting power and water infrastructure.
Kim pointed out, “The question now is how we will support the artificial intelligence revolution. Looking ahead to the next phase seven to eight years from now, we face the challenge of finding large-scale new sites for the second cluster.”
Kim also added, “Once the plan is finalized, government departments and companies will jointly explain it to the public. I expect such an opportunity to arise soon.”
Next-Stage Expansion
Over the past several years, Samsung Electronics and SK Hynix have invested heavily in the Yongin National Industrial Complex and plan to build multiple manufacturing plants there over the long term.
The Yongin complex is located in Yongin, Gyeonggi Province, South Korea, covering an area of approximately 7.28 million square meters (7.28 square kilometers). It is a national strategic project formally designated by the South Korean government in December 2024, aimed at building the core base of the world’s largest semiconductor cluster.
According to SK Hynix’s current plan, it is building four wafer fabs in Yongin and currently intends to significantly advance the completion time of the fourth factory from the originally scheduled 2044 to 2034.
Samsung’s project, originally planned for completion by 2048, also needs to be completed around 2034 or 2035 at Kim Yong-beom’s request.
Kim also pointed out that the challenge is not limited to accelerating construction progress, because even if existing projects are completed ahead of schedule, the Seoul metropolitan area is unlikely to have enough land, power, and water resources to support the next phase of expansion. “We need to accelerate these projects at an extraordinary speed and prepare for follow-up work.”
When asked whether the government is considering the Hamgyong region, including Gwangju, Bukdo, and Namdo, as a potential site for a second semiconductor industrial cluster, Kim stated that such an approach aligns with the Lee Jae-myung administration’s thinking, saying, “This is the principle we should follow.”
Kim emphasized that the search for a new semiconductor hub reflects a broader rethink of regional development in the AI era. “We now need a new force to alleviate the concentration in the Seoul metropolitan area and expand the space for growth, and I believe the answer lies in these regions,” he said.
He also noted that the infrastructure needed to support AI-driven growth, including power generation, data centers, advanced manufacturing facilities, and next-generation power grids, will increasingly favor areas outside Seoul.
Meanwhile, at the forum, Kim also clarified that speculation suggesting the creation of a new semiconductor industrial center outside the capital region would sacrifice existing investment in Yongin, Gyeonggi Province, is incorrect. Kim stated that Yongin has developed into a core project for Korea’s chip manufacturing expansion, so “this is absolutely not about canceling the project originally planned for Yongin and moving it to another region.”
