South Korea Bolsters Semiconductor Sector Amidst Tariff Challenges

South Korea plans to increase its financial support for the semiconductor industry to 33 trillion won ($23 billion). The funds will be used for low-cost loans, subsidies, and infrastructure to bolster chip development and maintain competitiveness against global and regional rivals amidst U.S. trade tensions.

In a strategic move to fortify its semiconductor industry against escalating trade tensions, South Korea has unveiled an expanded financial package worth 33 trillion won ($23 billion). This initiative represents a significant increase from last year's allocation of 26 trillion won ($18 billion), reflecting heightened efforts to navigate uncertainties posed by the Trump administration's tariff hikes.

The government is set to provide low-cost loans, subsidies, and other incentives tailored to stimulate investment in advanced chip development. There is also a commitment to bolster spending on industrial infrastructure, notably by funding key components like underground power systems in semiconductor clusters, crucial for giants like Samsung and SK Hynix.

Furthermore, amid mounting competition from Taiwan and the rapid advancement of Chinese firms, the expansion plan seeks to sustain South Korea's technological edge in producing high-tech chips for AI and other advanced applications. In parallel, an emergency 3 trillion won ($2 billion) fund has been deployed to shield its automobile industry from U.S. tariffs, accentuating Seoul's resolve to safeguard its export-driven economy.

(With inputs from agencies.)