SEOUL, South Korea (AP) — South Korean tech giants Samsung Electronics and SK Hynix said on Monday they will invest a total of 800 trillion won ($518 billion) to build a new computer chip manufacturing center in the country’s southwest region, capitalizing on rising demand. artificial intelligence -demand-driven.
President Lee Jae-myung joined company chairmen on Monday in announcing the plan, which is consistent with the government’s efforts to expand investment beyond greater Seoul, the country’s economic hub and the heart of its semiconductor sector.
Particular attention was paid to the southwest because it lacks major industrial centers and has historically lagged behind in economic development. The region has long been the political base of Lee’s liberal Democratic Party.
Samsung and SK Hynix, which together make about two-thirds of the world’s memory chips, said they would each build two manufacturing plants in the southwest, expanding the boundaries of their existing manufacturing complexes in Gyeonggi province, south of Seoul.
Samsung Chairman Lee Jae-yong said the company’s new factories would be built in the southwestern city of Gwangju, where experts have suggested several potential sites, including the site of a military air base that is planned to be relocated.
The companies did not specify when work would be completed in the southwestern regions. SK Hynix Chairman Chey Tae-won said the project will be a complex and large-scale project, requiring “huge areas as well as sufficient electricity, water and skilled workers.” He said it took SK Hynix nine years to set up its large manufacturing cluster in Gyeonggi Province. However, for the company to keep pace with global demand, a significant expansion of production capacity is needed, according to Chey.
Government officials dismissed questions about whether the Southwest has enough power and water to support large semiconductor factories. They stated that the region’s strength lies in renewable energy will give chipmakers an edge in an increasingly global pressure to use cleaner sources of electricity.
Samsung and SK Hynix reported record profits in recent months as growing global investment in data centers and other artificial intelligence infrastructure fueled demand for memory chips. Government officials and business experts expect demand for artificial intelligence to continue to grow as the technology spreads around the world. Industrial robots with artificial intelligence and autonomous vehicles. Chip makers’ existing semiconductor complexes in Gyeonggi province may reach capacity sooner than expected, they said.
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During Monday’s event, government officials laid out plans to create what they call a nationwide semiconductor ecosystem, with existing manufacturing centers in the southeast expanding production of chip components and materials, the central Chuncheon region focusing on chip packaging, and data centers being built across the country.
“We must create the basic building blocks of artificial intelligence faster than any other country. Semiconductors, physical artificial intelligence and artificial intelligence data centers are the three pillars of our next great leap forward,” the president said.