Communications of the ACM
South Korea's Nationwide Effort for AI Semiconductor Industry
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As global competition in the semiconductor industry has intensified with trade conflicts and semiconductor shortages, major countries worldwide have started to work on their government policy and investment plan to win technological hegemony. South Korea's semiconductor industry, which makes up almost 20% of the nation's gross domestic product (GDP), is heavily concentrated on the memory semiconductor sector.5 It dominates the global memory semiconductor market with a 56.9% share but has little influence on the other sectors of the industry, including logic, analog, and optical discrete, where it has less than a 3% market share. To grow the nation's biggest industry further, South Korea has put a priority on non-memory sectors. The emerging AI chip market is an especially great opportunity for them, as demand is expected to increase exponentially with the paradigm shift in computing. South Korea aims to become a comprehensive semiconductor powerhouse from this colossal opportunity. In this article, we report recent nationwide efforts taking place in South Korea to challenge the emerging AI semiconductor industry. We organize these efforts in four sections (government, major companies, fabless startups, and academia), while Figure 1 overviews the overall efforts.
Figure 1. Overview of South Korea's nationwide efforts for the AI semiconductor industry.
The South Korean government's K-semiconductor strategy is to build the world's best semiconductor supply chain by 2030 with a $450B investment plan.2 Learning from the semiconductor crisis, the goal is to stabilize and internalize the semi-conductor supply chain by gathering fabless, foundry, and packaging companies in a clustered area called the K-Semiconductor Belt for seamless silicon product manufacturing. The government has also announced nearly $260B-worth of tax deductions for semiconductor facilities and R&D funding,3 in addition to making the approval process for the expansion of semiconductor manufacturing facilities faster and more flexible, and subsidizing up to 50% of the construction cost of the facility's power infrastructure. The government pledged to invest in strategically important semiconductor sectors, including power, automotive, and AI semiconductors, as part of its long-term R&D road-map. With the above financial and regulatory support, the government set a goal of doubling semiconductor production to $245B, with an export target of $200B, by 2030.
The government also is trying to build a collaborative ecosystem that helps once-segmented academia and industry work together to make competitive products for the global market. It has set up national programs to facilitate collaboration between university labs and startup companies by funding technology transfer and commercialization. The government also is subsidizing startup fabless companies to use the latest EDA tools and semiconductor process technologies.
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