South Korea plans 'world's largest' $230B Samsung chip factory to rival US subsidies

Christopher Hutton

March 15, 12:28 PM March 15, 12:28 PM

Samsung intends to invest more than $230 billion into South Korean semiconductor production facilities over the next 20 years in hopes of building the largest chip factory in the world.

The plan, which will include support from the South Korean government, includes building five new factories and attracting related businesses to a cluster of facilities near Seoul.

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"The economic battlefield, which recently began with chips, has expanded. Countries are providing large-scale subsidies and tax support," South Korean President Yoon Suk Yeol said on Wednesday.

Samsung's expansion in South Korea comes as several countries attempt to expand their presence in the chip market after an international shortage during the pandemic. The United States passed the CHIPS Act, which provided $52 billion to chipmakers to encourage them to build factories in the United States.

The investment will be a historic expansion for South Korea-based Samsung, which is considered the world's biggest memory chipmaker. Taiwan continues to be the largest manufacturer of chips worldwide, but other countries are attempting to compete.

The United States is also considering limiting the production abilities of South Korean companies within China in hopes of inhibiting Chinese access to advanced technology.

Chipped off: Lawmakers take $186M in donations from business interests reliant on Chinese chips

Tori Richards

December 08, 12:31 AM December 08, 12:31 AM

While the telecom and defense industries fight to keep buying Chinese-manufactured chips, a host of companies like Boeing, General Dynamics, Cox Communications, and AT&T have doled out more than $123 million in lobbying and contributions to Congress this year.

And the U.S. Chamber of Commerce, the leading voice seeking to water down a pending revision to the National Defense Authorization Act curtailing the use of chips, has spent $63 million. Republicans received 74% of these funds, OpenSecrets reported.

Congress is in the midst of crafting a deadline to curtail the use of the chips by federal agencies and their contractors.

The measure started with a two-year deadline to prohibit the use of Chinese-manufactured chips but was pushed back to five years with numerous carveouts after the Chamber authored a letter to the Committee on Armed Services. It stated that hardships would ensue.

“The good news is this legislation recognizes that we cannot have a shared high-tech industrial base with China, a country in military competition with us,” said retired Rear Adm. Mark Montgomery, a cyber expert at the Foundation for Defense of Democracies. “The less desirable part is the length of time given for companies to extricate themselves from the Chinese supply chain.”

Twenty-three senators and 102 House members took contributions from a group of the nation’s 14 largest corporations believed to utilize Chinese chips in their products as well as the Chamber. This includes 78 Republicans and 47 Democrats, according to an analysis of OpenSecrets data by the grassroots organization Chip in America.

The average contribution was $2,941 in the Senate and $2,062 in the House. But there are those who amassed a far bigger fortune, such as Senate Minority Leader Mitch McConnell (R-KY), who received $518,373 last year.

The list of contribution recipients is a who’s who on Capitol Hill, with some firebrand members notably absent, such as GOP Sens. Tom Cotton (AR) and Rand Paul (KY) and Republican Rep. Jim Jordan (OH).

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“There is the money side to this also,” said Dustin Carmack, former chief of staff to the U.S. director of national intelligence. “You have to look at where these industries are located and where they have subcontractors. With all 435 districts in the country, they have some connection there.”

Carmack said the companies undoubtedly put pressure on Congress and held that removing Chinese chips will raise costs and put them out of business.

“I would rather spend the dollars and make sure supply chains are more secure than have subcomponents from China,” Carmack said.

But companies need to help protect American interests and not just look at their bottom line, said Wayne Gross, a former federal prosecutor who represents Chip in America, which is fighting to bring chip manufacturing back to the United States.

“American companies currently sourcing chips from questionable sources should do their part to stop the infiltration of our technology,” he said.

Montgomery, however, wasn’t convinced that donations equal votes on the chip bill.

“They are getting money from telecom and defense companies for a lot of things but not necessarily tied to this issue,” he said. “I think in the end, [lawmakers] will do the right thing.”