South Korea has announced a massive support package for its semiconductor industry, totaling 33 trillion won (over $23 billion), in response to the growing threat of U.S. tariffs that could hit key players in the industry, such as Samsung Electronics and SK Hynix, CNBC reported.
Donald Trump recently announced that he plans to announce tariffs on semiconductor imports, although he temporarily exempted them from the general list of "reciprocal" tariffs last Friday. Trump also announced his intention to conduct an investigation of the entire electronic supply chain for national security reasons. At the same time, the US Department of Commerce announced the launch of a separate investigation into the impact of imports of chips and equipment on national security.
South Korea's new aid package is 25% larger than last year's. The government will finance the construction of underground power lines to semiconductor manufacturing clusters and increase the share of state funding for industrial infrastructure to 50%. In addition, companies will receive 20 trillion won in soft loans from 2025 to 2027.
It also envisages the development of research and educational programs for masters and postgraduates, as well as the involvement of foreign specialists in international projects.
In 2024, South Korean chip exports reached $141.9 billion, more than 20% of the country's total exports. The United States remains Korea's second largest market, with exports growing by 10.5% to $127.8 billion. According to media reports, Trump has instructed his administration to begin negotiations with South Korea on new tariffs.