South Korea unveils $30.6 billion support package for chips amid US tariff uncertainty

SEOUL - South Korea announced on April 15 an increase in its support package for the country’s vital semiconductor industry to 33 trillion won (S$30.6 billion), up about a quarter from a 26 trillion won package unveiled in 2024.

The measures come in response to calls on the government to expand support at a time of growing policy uncertainty under the current US administration and rising competition from Chinese rivals, the government said in a statement.

Seoul will also ramp up a financial assistance programme for the chips industry to 20 trillion won, versus the previous 17 trillion won, according to the joint statement from various ministries, including the Trade Ministry.

South Korea’s decision to pump more money into its key chips sector is designed to help companies cope with heavier costs as they compete globally, it said.

Asia’s fourth-largest economy is home to the world’s top memory chipmakers, Samsung Electronics and SK Hynix, though they have fallen behind some rivals in areas such as chip design and contract chip manufacturing.

In 2024, South Korea’s exports of semiconductors stood at US$141.9 billion (S$187 billion), accounting for 21 per cent of the country’s total, government data showed.

Shipments to China and the US stood at US$46.6 billion and US$10.7 billion, respectively.

US President Donald Trump’s administration pressed forward with plans to impose tariffs on semiconductor and pharmaceutical imports by initiating

probes led by the Commerce Department

. The moves, announced on April 14 in the Federal Register, are a precursor to imposing tariffs and threaten to broaden the President’s sweeping US trade war.

In a meeting held on April 15 after the announcement, South Korean Finance Minister Choi Sang-mok said the government would consult actively with the US over its Section 232 investigations into semiconductor and biopharmaceutical imports to minimise any adverse impact on domestic companies.

Last week, South Korea announced emergency support measures for its auto sector, seeking to reduce the blow of US tariffs on a sector that has seen years of sharply rising exports to the US.

The measures include financial support for the auto industry as well as tax cuts and subsidies to boost domestic demand, while the government also vowed efforts to negotiate with the US and help expand markets. REUTERS