[Suwon = E-Daily Reporter Hwang Young-min] Uncertainty is growing regarding 734.9 billion won in foreign investment due to the "exclusion of the Seoul metropolitan area" clause included in the Special Act on Semiconductors.

According to a comprehensive report by Edaily on the 8th, Article 15 of the draft enforcement decree for the "Special Act on Strengthening the Competitiveness and Support of the Semiconductor Industry" (Semiconductor Special Act)—which the Ministry of Trade, Industry and Energy plans to announce for public comment this month—specifies that a region must be "outside the Seoul metropolitan area" as a requirement for designation (or application) as a semiconductor cluster.

If designated as a semiconductor cluster, the area will not only receive government funding for infrastructure such as power, water, and roads but will also be exempt from preliminary feasibility studies or given priority selection when pursuing public projects with a total cost of 50 billion won or more. Special fast-track procedures for relevant permits and approvals are also granted, enabling expedited project implementation, and clusters can receive various forms of support, including reductions in fees for the use or lease of state- and public-owned property, exemptions from various levies, and the creation of favorable living conditions.

This Special Act on Semiconductors demonstrates the government’s commitment to establishing semiconductor clusters eligible for these special provisions exclusively in non-metropolitan areas.

The issue is that Gyeonggi Province already hosts the world’s largest semiconductor mega-cluster, including the Giheung and Hwaseong campuses—where #Samsung Electronics successfully developed 64M DRAM in 1992 to become the global leader in DRAM—as well as the Pyeongtaek Godeok campus and the #SK Hynix Icheon plant.

In addition to the Yongin Semiconductor Cluster General Industrial Complex, where SK Hynix is investing 600 trillion won, and the Yongin National Advanced System Semiconductor Industrial Complex, where Samsung Electronics is investing 360 trillion won, recent investments by domestic and international companies—including ASML (Hwaseong), AMAT (Yongin), LAM (Hwaseong, Osan, Yongin), and TEL (Hwaseong)—the total investment from domestic and international companies currently underway amounts to 1,141.3 trillion won. Of this, investment from foreign companies totals 913.7 billion won.

In particular, Gyeonggi Province predicted that if the enforcement decree of the Special Act—which includes a clause excluding the Seoul Metropolitan Area from the semiconductor cluster—is passed, foreign companies’ currently planned investments totaling 734.9 billion won would face delays due to the inability to provide infrastructure and other support.

Cities and counties within the province are also expressing concerns about the Special Act on Semiconductors.

In the case of Seongnam City, if the fast-track approval process for the Third Pangyo Fabless Cluster is not applied, an extension of the project period will be inevitable. Icheon fears a loss of momentum for additional investment in education and research facilities aimed at advancing the technology of key component, material, and equipment companies associated with SK Hynix, while Yongin and Pyeongtaek are concerned that the exclusion of support for strengthening competitiveness and funding for semiconductor foundry and back-end processes (packaging and testing) will negatively impact the development of the Pyeongtaek Campus hinterland and the attraction of additional investment.

Gyeonggi Province and its cities and counties held an emergency meeting on the 28th of last month and agreed to establish a joint response system regarding the provisions excluding the Seoul Metropolitan Area contained in the draft enforcement decree of the Special Act on Semiconductors. Chu Mi-ae, the governor-elect of Gyeonggi Province, also pledged during the election campaign to create a world-class semiconductor mega-cluster in the eight local governments of the southern Gyeonggi region—"Su-Yong-Seong-Pyeong-O-I" (Suwon, Yongin, Seongnam, Hwaseong, Anseong, Pyeongtaek, Osan, and Icheon).

Hyun Byung-cheon, Director General of the Future Growth Industries Bureau at Gyeonggi Province, emphasized, “The semiconductor industry must be guided by economic logic, not politics.” He added, “The reason Japan has fallen behind in the global semiconductor market is a lack of integration. There is analysis suggesting that Taiwan succeeded by forming clusters,” and stressed, “From the perspective of national competitiveness, we must not miss this golden opportunity.” Director Hyun continued, “I fully respect and agree with the intent of balanced regional development,” but expressed concern, saying, “Balanced development should take the form of creating a new framework centered on non-capital regions. If we disrupt the existing framework, it will increase uncertainty regarding additional investments by overseas equipment manufacturers and negatively impact the semiconductor industry ecosystem.”