Samsung to invest W100 tril. in Gyeonggi Province

By Kim Yoo-chul

Samsung Electronics said Tuesday that it will invest as much as 100 trillion won to build a mega industrial complex in the provincial city of Pyeongtaek, some 80 kilometers south of Seoul.

This is the biggest investment in Samsung’s corporate history. The investment will proceed over the next three years if the commitment goes through as planned.

Gyeonggi Provincial Government said in a statement that Samsung has fixed the big investment plan in the future industrial park that will house chip-making factories and solar-cell facilities and other Samsung-identified next cash-generators such as medical equipment.

``It’s true that Samsung and the provincial government signed a final agreement for the investment plan,’’ said company spokesman Shin Young-june, Tuesday.

In December 2010, Samsung signed a preliminary agreement with the provincial government for the investment plan.

The statement said the construction of the complex will start from August this year. The completion has been set for late 2015.

Government officials say the complex is on a tract of 3.96 million square meters and some 30,000 new jobs will be created.

``Some 2.4 trillion won will be invested only for groundwork for the complex,’’ said a government official.

Samsung has advanced chip-making plants in Hwaseong and Giheung, on the outskirts of Seoul, while it has a back-end assembly line in Onyang, North Chungcheong Province.

Samsung sources contacted by The Korea Times said that chances are high Samsung, which is the world’s biggest memory chipmaker, will build its highly-advanced non-memory chip lines at the industrial complex.

``Because the global memory chip industry is seeing a big shift towards non-memory chips, it’s very unlikely that Samsung will make memory chip-producing lines at the complex,’’ said one high-ranked Samsung executive by telephone.

Based in Suwon, Gyeonggi Province, Samsung runs its biggest overseas non-memory chip line in Texas, the United States, to provide its fine-tuned non-memory chips such as mobile application processors (APs) to its North American customers such as Apple, Hewlett-Packard and Dell.

The tech giant Samsung plans to produce flash-type memory chips at its first Chinese chip-making plant in Xian. Samsung runs a back-end line in Suzhou.

``Gyeonggi Province welcomes Samsung’s final agreement for the investment. The plan will see Samsung build a next-generation industrial belt linking Samsung’s headquarters in Suwon, Hwaseong, Dongtan, Pyeongtaek into Asan, where Samsung’s display-making plant is located,’’ said the statement.

With chips, Samsung is heavily increasing its investment in solar-cells and medical equipment because those businesses are the Korean technology heavyweight’s new cash-cows. Samsung accounts for more than 20 percent of Korea’s total exports.

``That’s why the investment plan is truly helpful for sagging regional economies,’’ the statement said.