Ahn Cheol-soo: "K-Semiconductor Strategy Is Not Enough... Must Show Firm Support Willingness Including Tax Policies"

"If participation in the Quad is difficult, active involvement in the Quad expert group meetings is necessary"

Ahn Cheol-soo, leader of the People’s Party, is attending the Supreme Council meeting held at the National Assembly on the 13th and delivering opening remarks. Photo by Yoon Dong-joo doso7@

[Asia Economy Reporter Naju-seok] Ahn Cheol-soo, leader of the People’s Party, demanded that the government take more radical measures to enhance semiconductor competitiveness.

At the People’s Party Supreme Council meeting held at the National Assembly on the 17th, Ahn said, “The recently announced government K-semiconductor strategy is desirable but still insufficient,” adding, “The government has talked about fostering non-memory semiconductors for 20 years but has not achieved sufficient results. Learning from this, a bolder and stronger strategy must be established, focusing on producing actual results.”

Ahn stated, “The United States has allocated $50 billion (about 56.3 trillion KRW) to support the semiconductor industry, which is the core of the 4th Industrial Revolution, and decided to provide tax credits of up to 40-50% of semiconductor manufacturing facility investment costs. Europe is planning an investment of 50 billion euros (about 68.44 trillion KRW). China even introduced a corporate tax exemption card,” and demanded, “At least the government must demonstrate a firm commitment to promoting the semiconductor industry by increasing tax and financial support to the level of the United States.” He criticized, “The government funding support of 1 trillion to 1.5 trillion KRW announced this time, 40-50% tax credits on semiconductor R&D investment, and 10-20% tax credits on facility investment costs are insufficient.”

He also urged support for workforce issues. Ahn said, “Regarding workforce issues, a large-scale semiconductor manpower supply plan beyond the scale of newly established semiconductor-related departments and expanded quotas announced this time should be created, and more bold and sufficient support is required to improve the treatment of core personnel such as semiconductor design,” adding, “Please do not insist only on the existing support system focused on employment creation numbers, but create a support system that properly nurtures ‘one person who can support a million people.’”

To this end, Ahn urged, “The government should promptly and proactively enact the ‘Special Act on Strengthening Semiconductor Competitiveness’ requested by the semiconductor industry.”

He also called for the government’s response to the US-China technological hegemony war. “The Biden administration is pursuing a strategy of establishing technology standards based on alliances and building a ‘China-free global supply chain,’ unlike the one-on-one trade war approach of the Trump administration,” he said, adding, “To avoid exclusion from the global supply chain and to not fall behind in international technology standards, the government’s swift decision is absolutely necessary even now.”

Regarding participation in the Quad, an informal consultative body involving the US, Japan, India, and Australia, he said, “If it is difficult to participate, at least we should actively participate in the expert group meetings under the Quad,” and emphasized, “Our companies must never be excluded from discussions on international technology standards and global supply chain construction.” He added, “Since semiconductors are a key industry and South Korea is highly regarded internationally in the IT field, it is only natural for Korea to participate in the Quad expert group in areas such as advanced technology development and intellectual property protection,” and said, “We should actively participate not only in semiconductors but also in cooperation in secondary batteries and 5G fields.”