South Korea’s President Moon Jae-in on Thursday said the government will expand its support for localizing the production of high-tech materials, components and equipment in his visit to SK Hynix’s chip plant at Icheon, Gyeonggi Province.
Moon said Japan’s “unjust trade restrictions” have continued over a year and that the country will use the crisis as an opportunity to become a power house in materials, components and equipment.
The government has selected a hundred goods that it has previously imported from Japan as core management items that it aims to localize the production. This will be now be expanded to 338 goods that South Korea currently imports from abroad.
South Korea will also select a hundred leading companies in materials, components and equipment to foster them to become world leaders in their respective areas, Moon said.
The country will also build a digital supply chain and smart distribution system to react faster to changes in the global supply chain, he said. It will also build an artificial intelligence (AI) platform to save cost and time in developing new materials by 70%.
Moon also said South Korea will become a “world factory for high-tech industries” by attracting companies working in high-tech sectors. It will also provide incentive for local conglomerates to return their high-tech facilities currently located in foregin countries back to South Korea, he said. The country will focus on new businesses such as semiconductors, bio-medicine, future cars, hydrogen and lithium-ion batteries. It will ask for a U-turn back to their home country for the electric, automobile and fashion industries, the president also said.
In a separate statement, the Ministry of Trade, Industry and Energy laid out the specifics of Moon’s plan, dubbed Materials, Components and Equipment 2.0. The 338 core management items will consist of 158 items in semiconductor, bio-medicine and future cars. 180 items will be those used in automobiles, electronics, electric and fashion industries. The rest will be in bio-medicine, environment, energy and robots. The country will invest over 5 trillion won by 2022 to localize the production of these items, the ministry said.
The budget will likely be used in a variety of ways. The ministry said it plans to expand the current 17 collaboration models between the government and companies to a hundred in the next five years. It will work with 15 public research institutes to create a test bed to verify the developed technologies to assist in their commercializations.
The ministry will also create a convergence and innovation support committee from 32 public research institutes. It will also operate technology and strategy advisory group for 13 universities.
The government will also create a growth fund for use by the hundred leading companies. It will also foster a hundred hidden champions and a hundred start-ups. A special industrial zone for materials, components and equipment will be made that offers various incentives and relaxation of regulations.
Moon stressed that the growth in materials, components and equipment and high-tech industry will overcome the economic crisis in South Korea. It is the road to innovative growth and industry security, he added.
The president also signed three additional agreements between the government and companies during the tour of the chip plant. They are for: the formation of the Yongin Semiconductor Cluster, co-growth between foreign investment companies and local companies and for facilitate the return of electronic industry to South Korea.