Samsung Electronics Chairman Lee Jae-yong (right) inspects the company's display-making unit Samsung Display's smartphone manufacturing plant near Hanoi, Vietnam in last December. (Samsung Electronics)
Key tech companies of Samsung Group, South Korea's largest conglomerate, will invest a combined 60.1 trillion won ($46.1 billion) over the next decade for the country’s manufacturing business in rural areas to pursue balanced regional development. This equates to about 10 percent of the South Korean government’s budget of 638 trillion won for this year.
The spending plan by Samsung’s affiliates, including Samsung Electronics, Samsung Display, Samsung SDI and Samsung Electro-Mechanics, is to enhance the competitiveness of local companies and major manufacturing industries, and boost high-quality jobs in rural areas such as those of North and South Chungcheong provinces, North and South Gyeongsang provinces and North and South Jeolla provinces, the group said Wednesday.
Samsung will designate specialized businesses in each region ranging from semiconductor packaging and cutting-edge displays to next-generation batteries and advanced multilayer ceramic capacitors, centering on the group’s worksites. The group is planning to boost the region’s competitive edge to a global level.
The group will establish a complex specialized for chip packaging, a comprehensive cluster for advanced displays and a "mother factory" for all-solid-state battery production in the Chungcheong provinces.
In the Gyeongsang provinces, Samsung Electro-Mechanics will invest heavily in research on key materials for multilayer ceramic capacitors, or MLCCs, which control the stable flow of the current in electronics circuits, and will foster the country’s largest port city Busan to become an “advanced MLCC special area.”
Samsung Electronics is planning to make the Jeolla area its “global smart home appliance production base” by expanding and reorganizing its Gwangju plant to focus on manufacturing premium smart home appliance products.
Samsung Electronics' office building in Seoul (Yonhap)
Since Lee Jae-yong was crowned Samsung Electronics’ new executive chairman in October last year, the de facto leader has visited the group’s manufacturing facilities across regions, starting with Gwangju, to inspect production sites and emphasize “win-win cooperation” and revitalization of the local economy. He urged executives and staff members to create a “virtuous cycle of coexistence” by creating a healthy ecosystem.
In addition to the investment of over 60 trillion won, Samsung will put forward an additional 3.6 trillion won over the next decade to supporting human resources training across the regions.
To revitalize the chip ecosystem, the group will invest 500 billion won each for joint research and development with local partners and the expansion of multiproject wafer services for small and medium-sized fabless companies.
It will also establish and operate an environmental, social and governance fund of 1 trillion won to support small and medium-sized enterprises in reducing greenhouse gas emissions and investing in their sustainability efforts.
"In addition to the investment, we look to realize a sustainable win-win model where companies in rural areas and the local economy grow together by supporting and nurturing the funds, technology and human resources of local companies in three dimensions," a Samsung official said.
By Jie Ye-eun (email@example.com)