Investments by Samsung Electronics and SK Hynix in the Honam region's semiconductor sector are taking shape. Specific details are expected to be revealed at a meeting of major corporate leaders hosted by President Lee Jae-myung at the end of this month.
Both companies are focusing on establishing packaging plants rather than constructing large semiconductor fabs. This shift is anticipated to bring significant changes to the domestic semiconductor industry landscape, although concerns have been raised. Critics argue that artificially dispersing the semiconductor ecosystem, which is currently concentrated in the capital region, could reduce supply chain efficiency.
However, viewing this initiative solely through the lens of regional distribution is a narrow perspective. The semiconductor industry has become a critical component of the power sector. With the rise of artificial intelligence (AI) semiconductor production and the expansion of data centers, power demand is increasing exponentially. The semiconductor cluster being developed around Yongin and Pyeongtaek also faces challenges related to power supply. In contrast, Honam boasts abundant renewable energy potential and relatively greater capacity for securing industrial land. From a corporate standpoint, there are ample reasons to diversify future production bases.
There are also aspects to consider regarding balanced regional development. While the domestic semiconductor industry has become a 'golden goose' thanks to the AI supercycle, the trickle-down effects on the national economy have been limited. Industrial disparities among regions have actually widened.
If Samsung Electronics and SK Hynix proceed with their investments, Honam has the potential to grow into a new semiconductor belt centered on advanced packaging.
Of course, there are practical limitations. A semiconductor front-end factory requires a dense ecosystem of hundreds of material, component, and equipment companies. This investment should not be viewed as a substitute for the capital region cluster. While Yongin and Pyeongtaek are the heart of Korea's semiconductor industry, Honam could become a new growth axis.
The government's role is also crucial. It should not simply shift the burden onto companies under the guise of regional balanced development. The government must swiftly support land acquisition and permitting processes to enable companies to make actual investment decisions, and actively work on building infrastructure for power and water supply. Reliable power supply is a key variable for maintaining semiconductor competitiveness in the AI era.
Enhancing logistics competitiveness is another challenge. The advanced packaging industry requires the rapid movement of materials, components, and equipment. Expanding logistics infrastructure that connects ports, airports, and road and rail networks is essential. Workforce development is also critical. There needs to be an expansion of semiconductor-focused educational programs centered around local universities and research institutions, along with the establishment of a workforce training system linked to companies. If the structure that draws talented individuals only to the capital region is not changed, establishing a stable industrial ecosystem will be difficult.
Semiconductors are the biggest beneficiaries of the AI era. Samsung Electronics and SK Hynix are entering a new growth phase with high-bandwidth memory (HBM) and other technologies. However, there is no guarantee that the successful formula that has worked for nearly half a century will remain effective. To maintain competitiveness, production capacity, talent, and the industrial ecosystem must expand nationwide.
Semiconductors are a national industry and should not be confined to a specific region. The construction of packaging plants by Samsung Electronics and SK Hynix in Honam goes beyond merely building new production facilities. It could serve as a turning point in reshaping the industrial map concentrated in the capital region and establishing a new milestone for balanced national growth. The government must also provide comprehensive support to ensure that companies' bold decisions become a reality. The future of Korea as a semiconductor powerhouse in the AI era must be built across a broader territory.
* This article has been translated by AI.
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