[Reporter’s Notebook] Semiconductor Complex, Political Logic Won't Work

'K-Semiconductor's Future' at Stake
Yongin Cluster Relocation Debate
Only Hindering Progress

"Isn't this fundamentally an issue of trust between the government and businesses?"

When controversy recently arose over the possible relocation of the Yongin Semiconductor Cluster to the Honam region, a semiconductor industry insider spoke candidly during a phone call with a reporter. The sound of footsteps, as the insider was walking somewhere, suddenly stopped, followed by the sound of clearing their throat. As if finally releasing pent-up frustration, the insider replied, "It's difficult for us to make any official statement on this political debate, but does this even make sense?" This person especially emphasized the issue of "trust," stating that the Yongin Semiconductor Cluster is the result of a firm promise made between the government and businesses.

The debate over relocating the semiconductor cluster was sparked entirely by political reasons. Last month, when the Minister of Climate and Energy mentioned the possibility of moving the semiconductor industrial complex to Honam due to the use of renewable energy, it triggered a political firestorm. Lawmakers from the Honam region issued statements, and tensions began to rise between the capital area and other regions. The main intention was to target local voters ahead of the regional elections in June this year. Even though relocating a semiconductor industrial complex that has already broken ground is no easy task, that did not deter the debate. Until the presidential office announced its official position on January 8, stating that it was "not considering" the relocation of the semiconductor cluster, companies in the industry could do nothing but worry. A semiconductor company representative said, "I was honestly afraid that this controversy would continue until the local elections."

The Yongin Semiconductor Cluster is a core base where the dreams of Korean semiconductor companies are coming to fruition. Some even say the future of "K-Semiconductors" depends on it. Before designating it as a forward base for the industry, companies thoroughly considered various factors such as workforce supply, the ecosystem for various equipment, and logistics. With investment amounts reaching hundreds of trillions of won, the review process had to be even more meticulous. In the era of artificial intelligence (AI), where demand for memory is soaring, the speed of factory construction has become crucial.

However, the controversy over relocating the factories has only served to hinder the progress of K-Semiconductors. Falling behind in timing ultimately leads to a loss of competitiveness. This lesson is evident from Japan's past experience. Japanese companies such as Toshiba lost their footing in the semiconductor market largely because they canceled or delayed factory construction projects in the 1990s and 2000s. An industry insider commented, "Relocating the industrial complex could lead us to repeat Japan's mistakes."

The debate over relocating the semiconductor industrial complex ended as a brief incident after the presidential office drew a clear line. However, for companies, it was an unexpected and distressing variable. Moreover, it is unclear whether the issue has been completely resolved. Until the local elections on June 3, the Yongin Semiconductor Cluster will undoubtedly become a recurring topic among politicians. Instead of engaging in endless debates over regional interests and the relocation of the industrial complex, shouldn't we be discussing constructive ways to enhance the competitiveness of domestic semiconductor companies?