Establishment of the shared infrastructure for thepost-processing of semiconductors; setting up a semiconductor’s fund, etc.
Incheon started its journey to develop the foundations to ascend as the Mecca of K-semiconductors.
The city reviewed the candidate sites among the clusters of semiconductorcompanies in Songdo International City and Namdong National Industrial Complexto proceed with the development of a specialized industrial complex which focuses on the ‘post-processing of semiconductors.’
Incheon plans to establish a specialized industrial complex development plan with experts and submit a proposal for the central government’s ‘Specialized Industrial Complex and Foundation Building’ program funding.
▲ Incheon will review the candidate sites among the clusters of semiconductor companies in Songdo International City and NamdongNational Industrial Complex, etc., to proceed with the development of aspecialized semiconductor industrial complex focusing on the ‘post-processing’industries for semiconductors. The images show the equipment for semiconductor industries.
In line with the government’s policy to cultivate semiconductor industry, local governments are competing each other to be selected as the site for the specialized semiconductor industrial complex. Incheon’s strategy to win in this competition is to establish a foundation to become the Mecca of the semiconductor industry emphasizing its potential and possibility for growth as a specialized city for the semiconductor industry.
The total market volume of the semiconductor industry of the world was 555.9 billion dollars (about 665 trillion won) in 2021, breaking its record with a 26.2% growth from 440.4 billion dollars of 2020. The volume of SouthKorea’s semiconductor export in 2021 broke the record with USD 129.7 billion dollars (154 trillion won), up by 29% from the preceding year (99.2 billiondollars).
The “Special Act on the Strengthening of the Competitiveness of theNational Strategic Advanced Industries and Their Protection,” which is scheduled to take effect starting from August 4th, contains the provisions on the bold support programs including infrastructures and manpower to the national strategic advanced industries, including semiconductors. If Songdo and Namdong Industrial Complex are designated as the semiconductor-specialized complexes, they become eligible to government supports and special benefits, such as fast-track permit processing, infrastructure building, tax benefits, and manpower training.
Why Incheon?
Anchor companies in post-processing sectors, no. 1 export industry,transportation and industrial hubs, and other qualification criteria are satisfied.
One of the key promises Mayor Yoo Jeongbok made during his campaign was to develop Incheon as the Mecca of semiconductor packaging.
While staying in line with the government’s policy to ‘make the country stronger in the field of semiconductors,’ the city plans to become the centerpiece of semiconductor industry with a differentiated strategy that is to‘build a region-specialized ecosystem.’
semiconductors is the top export item of the city, and the growth of export is driven by system semiconductors.
The share of semiconductors in total export last year was 26.5% (12.2 billion dollar), which was higher than the second in place, automobile, by17.8% (8.7%, 3.97 billion dollars). The total export volume of semiconductors grew by 69.8% from the preceding year (7.1 billion dollars), further strengthening its position as Incheon’s top export item.
Especially in the case of Incheon, system semiconductors accounted for 94%of the total semiconductors export, indicating that the city has a higherpotential in the system semiconductors sector, where South Korea is relativelyweak.
▲ While staying in line with the government’s policy to ‘make the country stronger in the field of semiconductors,’ the city plans to become the centerpiece of semiconductor industry with a differentiated strategy that is to ‘build a region-specialized ecosystem.’
Semiconductors are divided into memory semiconductors and non-memory semiconductors (system semiconductors). South Korea’s market share in the‘memory semiconductors’ sector is 53.2% of the total world market, making it an unrivaled top player. However, its share in the system semiconductors sector is an ignorable 3%.
Also, the world’s second and third largest companies such as Amkor Korea, STATS Chip PAC Korea, and other post-processing (packaging and testing) companies, as well as 1,264 global semiconductors equipment companies are located in Incheon. In addition, the city has a free economic zone, aviation and logistics infrastructure, universities, research labs, and other environmental elements that are optimal for global companies and investment inducement.
The Strategy of Incheon to Become the Mecca of ‘K-semiconductors
Establish an ecosystem that is sustainable through the development of specialized talents, funds, and strategic R&D of Incheon.
Incheon plans to embark on the project to establish the shared infrastructure for the post-processing of semiconductors starting from the next year to enhance the technological capabilities for advanced packaging.
The plan includes the establishment of the measurement, analysis, and testing equipment that can be shared by the semiconductors post-processing companies to support their standard certification and development of core technologies. Also, they plan to utilize the experts and infrastructures of government-funded labs and the regional innovation organizations for their program to support the development and research activities for semiconductor materials, components, and equipment companies.
In addition, the city plans to establish a 20-billion-won fund for semiconductors to promote the growth of the promising small or medium-sized companies.
Incheon will invest two billion won into this fund, and VCs, parent funds, private businesses, and other players in the private sector will be investing eighteen billion won, totaling twenty billion won to be invested into this semiconductors fund, which will then be used to cultivate and identify the unicorn companies in the semiconductors that have global competitiveness.
▲ Incheon plans to develop a sustainable ecosystem through R&D supports, training of experts, and establishing a fund to develop a K-semiconductors Mecca.
In addition, the city will work with the universities in the area to train the customized workers for semiconductors companies while focusing on the development of a semiconductors ecosystem that is sustainable and well-structured.
First, the city will engage in its ‘Semiconductor-Major Track’ program to run the major tracks for elements and designing majors and the materials/process/equipment major tracks, as it train versatile talents who can cover both the pre and post-processing of system semiconductors.
With the “Semiconductors Infrastructure Utilization Field Workers Training’ program, the city will be leveraging on the semiconductors infrastructure in universities to run the technological capability enhancement training programs based on the demands among the materials, components, and equipment companies in semiconductor sectors to enhance the practical skills ofthe current workers while matching the employers and skilled job seekers in the field.
The city will also work with Incheon Office of Education to encourage the students of vocational high schools to grow into various types of intermediate-level workers in semiconductor industries by building a career growth path connecting vocational high schools, companies (hire-first) –universities (teach-later).
