The ministry said NPUs and PIM architectures are expected to enable more sophisticated AI inference than current high-bandwidth memory (HBM), a segment that has been dominated by Korean manufacturers and has driven recent earnings for the industry. (Image courtesy of Yonhap)
SEOUL, Dec. 10 (Korea Bizwire) — South Korea unveiled a sweeping industrial strategy Wednesday to defend its lead in advanced memory semiconductors and accelerate development in underperforming segments, as global competition over artificial intelligence (AI) chips intensifies.
Industry Minister Kim Jung-kwan said the government will invest 215.9 billion won ($146.8 million) by 2032 in next-generation memory technologies, including neural processing units (NPUs) and processing-in-memory (PIM) chips. The plan was presented at an interagency semiconductor meeting presided over by President Lee Jae Myung, underscoring the state’s commitment to long-term technological leadership.
The ministry said NPUs and PIM architectures are expected to enable more sophisticated AI inference than current high-bandwidth memory (HBM), a segment that has been dominated by Korean manufacturers and has driven recent earnings for the industry.
The government will also spend 1.27 trillion won over the next five years to develop AI-optimized semiconductors, and an additional 620.7 billion won through 2031 on compound chips and advanced packaging technologies.
In the manufacturing arena, Seoul plans to support the construction of 10 new semiconductor fabrication plants by 2047, backed by a combined investment of roughly 700 trillion won across the public and private sectors. The initiative aims to secure Korea’s position as a global chip production hub at a time when the U.S., China, Japan and the EU are accelerating domestic subsidy programs.
President Lee Jae Myung speaks at a policy briefing on Korea’s semiconductor vision and growth strategy in the AI era at the presidential office in Yongsan on December 10. From left: President Lee, Vice Prime Minister and Science and ICT Minister Bae Kyung-hoon, and Industry Minister Kim Jung-kwan. (Yonhap)
The strategy highlights a priority that has long dogged the industry: system semiconductors, where Korea trails global rivals. The government said it will promote a collaborative model linking demand-side companies with domestic fabless semiconductor firms to accelerate on-device AI development and to expand production of “middle-tech” chips—components that are less advanced than AI processors but still require significant engineering, such as automotive microcontrollers and power management ICs.
To help domestic fabless firms secure manufacturing capacity, Seoul and private companies will establish Korea’s first cooperative foundry dedicated to local chip design houses, addressing a long-standing bottleneck for smaller firms seeking production slots at large contract manufacturers.
The government also plans to upgrade the broader semiconductor ecosystem by strengthening technological capacity in materials, parts and equipment—the backbone of chip manufacturing and a strategic vulnerability exposed during past trade disputes.
Seoul will launch a national project to build the country’s first mass-production test bed for semiconductor materials, parts and equipment, aiming for full operation in 2027. The facility is designed to shorten product verification cycles and accelerate commercialization.
Talent development is another pillar of the plan. The country will expand the number of semiconductor graduate programs to 10 by 2030, up from six today. Last week, the ministry signed a preliminary agreement with the U.K.’s Arm Ltd. to train 1,400 chip design specialists domestically.
This file photo taken on Nov. 3, 2025, shows SK hynix Inc.’s HBM3E product showcased at the company’s AI summit event held in southern Seoul. (Yonhap)
The semiconductor roadmap is also being aligned with Seoul’s regional development strategy. The southwestern city of Gwangju would specialize in advanced chip packaging, Busan in power semiconductors, and Gumi in materials and components.
“To win the global semiconductor race, we must marshal the full strength of our nation,” Kim said, promising to protect Korea’s dominance in memory chips while closing capability gaps in system semiconductors.
Kevin Lee (kevinlee@koreabizwire.com)
