- Samsung expands domestic chip investment amid concerns over U.S. trade deal impact.
- President urges companies to prioritize local investment despite major U.S. commitments.
- Hyundai and shipbuilders plan major investments as global semiconductor demand rises.
Samsung Electronics, Hyundai Motor, and other prominent South Korean producers revealed plans for domestic investment, amid worries that a U.S. trade agreement could diminish manufacturing capabilities in South Korea.
Samsung Electronics plans to expand its chip manufacturing capacity at its facility in Pyeongtaek, South Korea, to address the increasing demand driven by the global surge in artificial intelligence. This initiative is part of the parent company's 450 trillion won ($310.79 billion) domestic investment strategy over the upcoming five years, according to the firm.
Samsung's announcement followed a meeting on Sunday with South Korean business leaders led by President Lee Jae Myung, after a U.S. trade agreement, which included a South Korean commitment to invest $350 billion in strategic sectors in the U.S., was finalized on Friday.
"There are concerns that domestic investment might shrink as U.S.-bound investments strengthen," Lee mentioned during the meeting that he urged companies to focus more on domestic investments. The president additionally requested businesses to engage with the government to effectively utilize the $350 billion investment package for their international investments.
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"Samsung will raise domestic investment, create quality jobs for young people and make even more efforts for a win-win with small and medium-sized, as well as venture companies," Samsung Electronics Chairman Jay Y. Lee said.
During the meeting, Hyundai Motor Group revealed domestic investments totaling 125.2 trillion won for the years 2026 to 2030, and shipbuilders Hanwha Ocean and HD Hyundai disclosed their investment strategies as well.
A spokesperson stated that the new Samsung factory, set to produce memory chips, will meet the demand for both traditional and AI servers. Semiconductor prices are soaring as chip manufacturers worldwide compete to develop AI chips, straining the availability of those used in phones, computers, and servers.