The government said it would sharply accelerate the creation of the semiconductor cluster in Yongin, Gyeonggi Province, but the bidding for the core preliminary step—the site development construction—has been stalled for half a year. With the president post at the Korea Land & Housing Corporation (LH) vacant for more than eight months, the final decision-making for placing large-scale construction orders is being delayed.
There are concerns that the early development of the Yongin national industrial complex, where Samsung Electronics plans to build six system semiconductor fabrication plants (fabs), could face setbacks.
◇ Bidding halted amid LH chief vacancy… first-half orders effectively derailed
According to Yongin City and government offices on the 30th, the bid notice for the "Yongin advanced system semiconductor national industrial complex development project," which LH plans to order, has not been issued for half a year. LH held a briefing on Dec. 10 last year and was reportedly planning to issue a bid notice early this year. However, with no notice issued through the end of June, first-half ordering has effectively fallen through.
The leadership vacuum at LH is cited as the reason for the bidding delay. LH has had its president seat vacant for more than eight months since former President Lee Han-joon resigned in October last year. On top of that, the vice president who had been serving as acting president resigned early this year, leaving the organization operating under a so-called "acting-for-the-acting" structure. Observers note that decision-making will inevitably be delayed on matters requiring final approval, such as bidding for large-scale national industrial complex development projects.
Yongin Mayor Lee Sang-il recently said, "The LH president should be appointed and the bidding procedure for the site development construction should proceed," pointing to this situation. A Yongin City official said, "As advance procedures such as land compensation have progressed considerably, we should be at the stage of placing the construction order," adding, "The bid notice is already more than six months late."
◇ National complex to host six Samsung fabs… pressure on 2030 operation timeline
The Yongin advanced system semiconductor national industrial complex will be developed on a site of 7,773,600 square meters, about 2.35 million pyeong, spanning Idong-eup and Namsa-eup in Cheoin-gu, Yongin, Gyeonggi Province. Samsung Electronics plans to build six system semiconductor fabs there. The government and Samsung Electronics are targeting operation of the first fab in the second half of 2030.
However, as bidding for the site development construction is delayed, pressure is mounting on the existing schedule. Even if a bid notice is issued, additional time will be needed before groundbreaking to allow for the notice period, document review, and contractor selection procedures. Inside and outside Yongin City, the view is that it will take about two to three months from notice to contractor selection.
The land compensation process is already well underway. A Yongin City official said, "Negotiated compensation with industrial complex landowners is nearing half, and expedited adjudication requests sought by landowners have progressed to about 35%," adding, "At this point, the site development construction should have been ordered and on-site procedures should have been put into full swing."
The government recently said it would speed up the establishment of semiconductor production bases. For the Yongin national industrial complex with Samsung Electronics participating, the plan is to move up the fab operation timeline by seven years from the existing plan, and for the general industrial complex that SK hynix is promoting in Yongin, shorten it by up to 12 years.
Based on four fabs at SK hynix, a plan is being discussed to move up the operation timeline from the originally slated 2045 to 2033. But on the ground, there is concern that without follow-through on site development construction and infrastructure build-out, the early operation plan will be hard to realize.
◇ Power and water variables… government needs to boost driving force
Power supply is also a key variable. For the first phase at the Yongin national industrial complex, Korea East-West Power (EWP), Korea Southern Power, and Korea Western Power will each build a 1 GW LNG power plant to supply a total of 3 GW for the first and second fabs. A second-phase power supply plan, including new transmission lines for the third and fourth fabs, has also been finalized.
Yongin City says that since the power supply plan is already in place, the central government must hasten execution. Mayor Lee said, "The Ministry of Climate, Energy and Environment is hesitating to implement the already confirmed power supply plan, watching only the groups opposing transmission."
Water supply is cited as another bottleneck for early fab operation. The integrated water supply pipeline project to provide water to the Yongin national industrial complex and the SK hynix general industrial complex is currently being pursued with completion targeted for 2034. However, to move up the operation start for SK hynix's third and fourth fabs to 2033, critics say the pipeline completion timeline must be advanced as well.
In the semiconductor industry, the view is that because the Yongin cluster is central to the Seoul metropolitan area's semiconductor production base, schedules for infrastructure such as site development, power, and water must move in step with fab investment plans. Mayor Lee said, "To move up the operation timing of SK hynix's third and fourth fabs, the integrated pipeline installation project must also be completed earlier than planned."