By Yoon Ja-young
The country's semiconductor and display companies will invest a combined 80.4 trillion won here by 2024. The government will support them in developing new technologies so they can continue to lead in the global market.
The Ministry of Trade, Industry and Energy and local chip and display manufacturers held a meeting Thursday, where they unveiled investment plans and development strategies. At the meeting were Minister of Trade, Industry and Energy Paik Un-gyu and top executives of SK Hynix, Samsung Electronics, Samsung Display and LG Display.
"Due to the Fourth Industrial Revolution, there is a new market opening in semiconductor and display industries. The industries should preemptively develop themselves, and the government will support them with policies," Paik said.
The executives unveiled investment plans of their companies, which would help the administration's top priority _ job creation. Their total investment in the country by 2024 will reach 80.4 trillion won.
It includes a 14.4 trillion won investment in NAND memory chip production and a 6 trillion won investment in application processors (AP) by Samsung Electronics. SK Hynix plans to invest 31 trillion won in NAND, while Samsung Display and LG Display will invest 14 trillion won and 15 trillion won each in organic light emitting diode (OLED) production.
Paik noted that the massive investments will create quality jobs.
"The semiconductor and display sectors offer jobs preferred by young people. The government will help the investments by getting rid of hurdles."
The ministry presented "GAP 5" strategy. It aims at overcoming the five-year technology gap with competitors that run ahead of Korea while maintaining the five-year gap with those chasing Korea. While Korean companies are leading the chip and display industries, players of developed economies such as the United States, Japan and Europe are leading in equipment and materials. Chinese companies, meanwhile, are closely chasing Korean firms, adding to concern that Korea should look for new markets beyond memory chips and OLED.
For this, the country plans to develop a new semiconductor which is 1,000 times better functioning, while consuming only one thousandth of the electricity consumed by current models. In the display sector, a next-generation flexible panel will be developed on top of setting up a new production system applying a printing method. It will save consumption of material by 60 percent while manufacturing time will be cut in half.
The government plans to pull up Korea's share in the global system semiconductor market to six percent by 2022 from the current three or four percent. Exports of OLED will triple to $25.5 billion in 2022 from $8.5 billion last year.
The government and the leading semiconductor and display manufacturers also agreed to share the bounty with small and medium sized companies. A total of 2 trillion won will be injected over the next five years to nurture equipment and material firms with global competitiveness.
The government aims at pulling up the localization ratio of semiconductor equipment to 30 percent in 2022 from the current 20 percent and the ratio for semiconductor materials to 70 percent from 50 percent. The localization ratio of display equipment and display materials will also go up to 80 percent from 70 percent, and to 50 percent from 30 percent, respectively.