The Korean semiconductor industry is making the largest facility investment ever. Semiconductor exports this year are expected to exceed 100 billion dollars for the second time ever. This is because global semiconductor demand is increasing as non-face-to-face economic activities are spreading due to the novel coronavirus infection (Corona 19).
$18.9 billion this year, $19.7 billion next year
Expected to increase demand for DRAM 19% and NAND 34%
Aggressive preemptive investment in case of supercycle
– The Ministry of Trade, Industry and Energy released data on ‘2020 semiconductor market trends and 2021 forecasts’. This year’s domestic semiconductor facility investment is expected to be $18.9 billion, an increase of 20.4% from last year ($15.7 billion). On the other hand, semiconductor facility investment in China is expected to decrease by 7.2% from last year and by 7.1% in Taiwan. It looks like Korea is striking out. For the global semiconductor industry as a whole, facility investment is expected to increase by 4.1% this year, the Ministry of Industry predicted.
Korean semiconductor facility investment. Graphic = Reporter Kim Kyung-jin [email protected]
– Ik-no Jo, head of the semiconductor display division of the Ministry of Industry, said, “We expect to retake the No. 1 position in global facility investment that was stolen to China and Taiwan in 2019 in two years.” The Ministry of Industry predicted that next year’s domestic semiconductor facility investment will increase more than this year to $19.7 billion.
Kim Kyung-min, researcher at Hana Financial Investment, said, “Samsung Electronics is increasing the scale of investment in foundry (consignment production) and NAND (memory semiconductor type) equipment. ) To reduce.”
KOTRA predicts that this year’s global semiconductor market will increase DRAM demand by 19% and NAND flash by 34% from the previous year. It is the appearance that Samsung Electronics and SK Hynix are aggressively making preemptive investments ahead of this year’s semiconductor’super cycle’ (super boom).
The Ministry of Strategy and Finance suggested 3.2% as the target for this year’s economic growth rate. The Bank of Korea forecasts a 3% growth this year. Improving the semiconductor industry is one of the key factors influencing the growth rate this year.
The BOK predicts that exports will increase by 5.3% this year. Semiconductors account for 15-20% of all exports. The Korea International Trade Association predicted that this year’s semiconductor exports will reach $102 billion, up 5.1% from last year. Semiconductor exports in December of last year increased by 30% from a year ago. According to the Ministry of Industry, in December last year, exports of 11 items out of 15 flagship exports recorded an increase.
However, some point out that it will be difficult to increase employment as much as facility investment has increased according to the characteristics of semiconductors, which are high-tech industries. Kang Seong-jin, a professor of economics at Korea University, said, “Semiconductors are a large-scale equipment industry that invests trillions of units to build factories, but the effect on employment is insignificant.”
Sejong = Reporter Kihwan Kim [email protected]
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