As Samsung Electronics and SK hynix unveiled plans to build a 800 trillion won semiconductor production base in the southwest region, voices of welcome poured out in Gwangju and South Jeolla. In contrast, regions excluded from the investment blueprint pushed back, saying, "Disclose the site selection criteria."
Samsung Electronics Chairman Lee Jae-yong and SK Group Chairman Chey Tae-won on the 29th announced plans to build four memory fabs at the National Briefing on the Three Mega Projects for Korea's Great Leap Forward, presided over by President Lee Jae-myung. Lee mentioned Gwangju as a candidate site, while Chey referred to the southwest region without specifying a particular location.
The specific plant sites are expected to be revealed at the National Briefing on the Southwest Region Investment Plan to be held on the 30th under the Ministry of Trade, Industry and Resources. In the southwest region, Gwangju Advanced District 3, Jangseong in South Jeolla, and Haenam Solaseado are being discussed as strong candidates.
◇ Plan for a "second semiconductor hub"... Gwangju and South Jeolla say it's a chance to expand the industrial ecosystem
The government plans to foster the southwest region as a "second semiconductor production hub," following the existing clusters centered on Gyeonggi and Chungcheong. The aim is to change the deployment of high-tech industries concentrated in the capital area to strengthen regional industrial bases and to offset the limits of existing production hubs where the burden on power and water supply has grown.
The president said, "Existing semiconductor production facilities centered on Yongin and Pyeongtaek have reached their limits in terms of power and water supply," adding, "To overcome the concentration in the capital area and the problem of regional decline, we need to change industrial deployment." The government plans to accelerate the establishment of production facilities by building a public-private cooperation system that bundles licensing and site development with power and water supply.
In the Gwangju and South Jeolla region, there was a unanimous welcome for the large-scale investment plans by global semiconductor corporations. The Gwangju Chamber of Commerce and Industry issued a statement of welcome immediately after the briefing, saying, "This will be an opportunity for the advanced semiconductor industry ecosystem concentrated in the capital area to expand to the southwest region, including Gwangju and South Jeolla."
A semiconductor cluster is a structure in which not only production facilities but also materials, parts, and equipment corporations, as well as logistics, construction, and services, move together across upstream and downstream industries. In the plant construction phase, civil engineering and construction workers flock in, and after operations begin, quality jobs and a supplier ecosystem can be sustained.
Local governments also promised full support. Gwangju Metropolitan Mayor-elect Min Hyung-bae said, "We will prepare support measures that corporations can tangibly feel, including offering inexpensive land," adding, "Of the 20 trillion won in integrated government support funds that were promised, we will back semiconductor investment with at least 5 trillion won, or even all of it if necessary."
He also takes the position that there will be no problems with water and power supply. Min said, "Each fab needs about 60,000 tons per day of first-grade water, but water is not something to worry about," adding, "If we reinforce the power grid and the energy storage system (ESS), about four fabs should be feasible without issue."
◇ Choo Kyung-ho says it's "national fissure development" that fuels regional conflict
By contrast, strong discontent erupted in Daegu and North Gyeongsang, which were excluded from large-corporation investment sites. Daegu Mayor-elect Choo Kyung-ho and North Gyeongsang Governor Lee Cheol-woo said at a National Assembly press conference, "Today's announcement bears the name of balanced national development, but its content and process are closer to national fissure development that instead fuels conflict and distrust between regions." They pointed out, "Right after the president's one-on-one meetings with corporate leaders, investment plans worth hundreds of trillions of won and state support were announced for specific regions, but the most important site selection criteria and review process remain shrouded in secrecy."
There was criticism in South Gyeongsang as well. Kang Min-guk, a lawmaker who heads the People Power Party's South Gyeongsang chapter, said, "As the national future industry strategy is being pursued centered on certain zones, the Yeongnam region is relatively marginalized," adding, "Balanced regional development is not about concentrating investment in specific areas but about providing fair opportunities to all regions."
◇ Honam takes front-end, Chungcheong takes back-end and data centers
Regional reactions were mixed. Analysts say Honam secured a highly symbolic investment in front-end fabs, while Chungcheong secured practical gains through back-end and data center investments. The government said it would invest 81 trillion won in the Chungcheong region to foster it as a packaging hub. New HBM fabs will be built in Onyang and Cheonan, and the government will support timely implementation of HBM packaging investments in Cheongju. The plan also includes a gigawatt (GW)-class AI data center in Dangjin, South Chungcheong.
Alongside expectations that the semiconductor investment announcement could signal the start of an industrial realignment by region, controversy is also growing over the transparency of the site selection process. Depending on how specifically the government explains the sites, support measures, and site selection criteria in the southwest region investment plan to be unveiled on the 30th, the level of backlash between regions could vary.