trategy K-Semiconductor The handicap of the Thai electronics industry to the world stage.

In the past decade, semiconductors have become South Korea’s number one export. Even amid the COVID-19 crisis, South Korea’s export sector has recovered since early 2021, in part due to increased global demand for electronics and technology as people work or spend more time at home. In January 2021, the value of South Korea’s memory chip exports increased by 21.7 percent from the same period in 2020, continuing double-digit growth for the fifth month. Conductor worth up to 93.9 billion US dollars. It accounted for 17.9 percent of South Korea’s total exports.

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With South Korea’s strength in the industry Along with the trend of the global economy to focus on the digital economy and the development of high technology, at the end of 2020, the South Korean government decided to announce that it would focus on the promotion and development of 3 major industries (“Big 3 Industries”) starting from from 2017 onwards, including (1) semiconductors, (2) future vehicles, and (3) biohealth for internal restructuring. country to economy and fully digital or green society This is in line with the Green New Deal and Digital New Deal policies announced on July 19, 2020 to revitalize and stimulate the South Korean economy.

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On May 13, 2021, President Moon Chae-in launched the strategy. K-Semiconductor Strategy, announcing that the government’s goal is to become a global semiconductor powerhouse by 2030. manufacturing, design and packaging. This is to tackle the shortage of semiconductors in the global supply chain. Due to the increasing use of electronic devices and the tendency to continuously increase the production and purchase of electric cars The government will cooperate with the South Korean private sector. drive the said strategy in 3 main areas as follows:

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  1. “K-Semiconductor Belt” – Building the World’s Largest Semiconductor Manufacturing Belt This will consist of building a new semiconductor manufacturing plant. and factories for handling raw materials, equipment, and assembly or packaging. The Belt will be centered in Yongin, Gyeonggi Province, which is now South Korea’s main semiconductor manufacturing region. It will extend westward to Pangyogi, Hwaseong, Pyeongtek and Ongyang, and eastward to Icheon and Seongju, supported by Samsung Electronics and SK Hynix, with a total budget of 41.8 trillion. KRW ($37 billion) this year to co-create the Belt and plans to contribute another 510 trillion won ($451 billion) over the course of its implementation. K-Semiconductor Strategy until 2030
  2. Taxes – 50 percent reduction in the tax rate for research and development (R&D) in the semiconductor industry. This is expected to result in a 30-40 percent reduction in R&D costs for medium and large companies and 40-50 percent for SMEs, as well as a 20 percent tax reduction for Investment in the semiconductor industry, which may result in a reduction in the corporate income tax rate of investor companies by 10-20 percent depending on the size of the company.
  3. Funds – Set up a special fund worth more than 1 trillion won (about 886 million US dollars) to facilitate investment in the semiconductor industry. This covers water supply for a period of 10 years to industrial estates or semiconductor factories in areas such as Yingin and Pyeong-Tek.

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The South Korean government will conduct a feasibility study for the implementation of various projects under this strategy within this year. Most recently, in July 2021, BOI Thailand has announced that will accelerate attracting new foreign investments and support the expansion of existing production bases in semiconductor or semiconductor equipment. and printed circuit boards (PCB), with the corporate income tax exemption up to 8 years, provided that the investment in machinery must be at least 1,500 million baht. In addition, for South Korean investment in Thailand, KEC (Korea Electronic Holdings) established a semiconductor factory in Thailand under KEC (Thailand) Co., Ltd. since 1990.

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Expanding production bases in South Korea’s semiconductor industry is an advantage for Thai entrepreneurs, especially in the business of electronic equipment and components or subcontracting production. In the semiconductor industry, South Korea’s semiconductor investment is closely expanding to find partner or co-investment opportunities. That can increase Thailand’s competitiveness on the world stage, especially in the S-Curve industry and may help Thailand have a higher proportion of production and export of high-tech products.

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Royal Thai Embassy in Seoul

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