South Korea Chip Support Package Expands to $23 Billion Amid US Tariff Risks: South Korea announced a $23.25 billion (33 trillion won) chip support package on Tuesday, April 15, 2025. The move strengthens its semiconductor industry amid rising global competition. It addresses growing challenges from Chinese rivals and potential US tariffs. South Korea’s chip support package has expanded last year’s 26 trillion won program.
It aims to keep South Korean chip firms competitive worldwide. Semiconductors drive 21% of the country’s exports, highlighting their economic importance. Top chipmakers Samsung Electronics and SK Hynix will benefit significantly. The increased funding helps them counter rising costs and maintain innovation leadership.
Also Read | China Adopts Bold Trade War Strategy to Counter Trump’s Tariffs
South Korea’s Chip Support Package Expands to $23 Billion Amid US Tariff Risks: Insights
- South Korea’s chip support package increased from 25% to $23 billion.
- The move responds to US tariff risks and Chinese competition.
- Financial aid for chip firms jumps to 20 trillion won ($17.6 billion).
- Semiconductors account for 21% of the country’s total exports.
- Samsung and SK Hynix lead in memory chips but lag in chip design.
- The US may soon announce new semiconductor tariffs.
Background
South Korea relies heavily on semiconductor exports. In 2024, chip exports hit $141.9 billion. China and the US are key buyers. However, US tariff threats have raised concerns. Last week, South Korea also announced auto sector support. This shows its focus on protecting key industries. South Korea’s chip support package follows similar global moves. Countries are boosting domestic chip production amid supply chain risks.
Main Event
South Korea has expanded its semiconductor support package to 33 trillion won(23.25 billion), with 20 trillion won ($17.6 billion) dedicated to direct financial assistance – up from 17 trillion won previously. The increased funding will help domestic chipmakers lower production costs and strengthen their position in the global market.
Samsung and SK Hynix lead in memory chips. But they trail in chip design and manufacturing. The package will help them stay competitive.
US President Donald Trump hinted at new semiconductor tariffs. South Korea’s finance minister, Choi Sang-mok, said talks with the US will continue. The goal is to reduce harm to local companies.
Last week, South Korea also announced auto industry support. This includes tax cuts and subsidies. The government is protecting key export sectors.
South Korea’s new $23.25 billion chip support package aims to strengthen such domestic facilities amid global competition.
Photo Credits: REUTERS.
Also Read | Yoon Suk-yeol Insurrection Trial Begins: Key Details and Implications
Implications
The chip support package will help South Korean firms. They can invest more in research and production. This strengthens their global position. For the US, new tariffs could raise costs. South Korea may push for exemptions. China’s growing chip industry adds pressure. Consumers might see higher electronics prices if tariffs hit. Businesses relying on chips must plan for supply changes.
Conclusion
South Korea’s chip support package shows its commitment to semiconductors. More aid may come if US tariffs hurt exports. Experts say global chip competition will intensify. South Korea must keep innovating to stay ahead.
