Nam Hyun-woo has worked as a staff writer at The Korea Times since 2013, mostly covering business and politics. He currently belongs to the Business Desk where he covers topics such as emerging tech, AI, ICT and Korea's chaebol community. Prior to joining the team, he was the paper's correspondent for the presidential office of Korea during the Yoon Suk Yeol and Moon Jae-in administrations.
President pledges support for Korean chipmakers to overcome crisis
President Yoon Suk Yeol and SK Group Chairman Chey Tae-won, right, inspect SK Siltron's silicon wafer facility in Gumi, North Gyeongsang Province, Wednesday. Yoon's visit came as the country's major chipmakers suffered disappointing earnings in the fourth quarter of last year amid a global downturn in the semiconductor industry. Yonhap
By Nam Hyun-woo
Yoon visits' ex-President Park's birthplace to appeal conservatives
By Nam Hyun-woo
President Yoon Suk Yeol said Wednesday the government will make all-out efforts to help Korean chipmakers overcome the current down cycle, citing semiconductors as a “national security asset that underpins the economy.”
“Semiconductors are the backbone of our economy and a national security asset,” Yoon said during his visit to an SK Siltron plant in Gumi, North Gyeongsang Province. “Although there are concerns over the semiconductor market, the government and companies should overcome this crisis together.”
Yoon attended a signing ceremony of a memorandum of understanding (MOU) between SK Siltron and North Gyeongsang Province. SK Siltron will spend 1.24 trillion won ($1 billion) from 2024 to 2026 to install new silicon wafer production facilities in Gumi. This is anticipated to create more than 1,000 jobs in the region, as well as stabilize the country's semiconductor material supply.
“It is true that the environment surrounding the Korean semiconductor industry is not favorable,” Yoon said. “We have to spare no efforts for the localization of materials, parts and equipment for chips, as well as making preemptive preparations for a memory chip price downturn and weakening demand stemming from a sluggish economy.”
Yoon added that competitors across the world are “posing threats” to Korea's semiconductor industry by employing export restrictions, subsidies, tax benefits and other measures.
“The government and companies should join in efforts to overcome this,” the president said, citing as a model case SK Siltron's investment and the city's subsequent decision to accelerate approval processes and provide a 5 billion won subsidy to the company.
Yoon's comments came as the country's major chipmakers suffered disappointing earnings in the fourth quarter of last year amid a global downturn in the semiconductor industry.
Samsung Electronics said Tuesday its fourth quarter sales dropped 7.97 percent year-on-year to 70.46 trillion won ($57.22 billion), while operating profit plunged 68.5 percent to 4.31 trillion won.
This is largely attributable to its sluggish memory chip business, which accounts for up to 70 percent of the company's total profits. The fourth quarter operating profit of Samsung's Device Solutions division, which supervises the chip business, plunged by 96.9 percent from a year earlier.
SK hynix, another South Korean semiconductor titan, also said Wednesday that it swung to an operating loss of 1.7 trillion won from a 4.2 trillion won profit a year earlier, marking the biggest quarterly loss since 2012. SK hynix also attributed the loss to the global down cycle in memory chip business, which accounts for nearly 90 percent of the company's total sales.
President Yoon Suk Yeol examines a smart factory monitoring system at the National Industrial Complex in Gumi, North Gyeongsang Province, Wednesday.
Before visiting SK Siltron, Yoon also paid a visit to Kumho National Institute of Technology in Gumi and stressed the importance of training semiconductor experts.
“Korea could succeed in industrialization and achieve economic growth during times of difficulty, because the country invested in people and nurtured talent,” Yoon said. “The only way for a country to survive in the global technological competition in the Fourth Industrial Revolution is training talented science experts.”
Yoon noted the Institute was established under former conservative President Park Chung-hee's initiative to nurture the country's science human resources pool in the 1970s, in what appears to be an appeal to the conservatives of the city. Gumi is the birthplace of the former president.
“Former President Park, who had an outstanding vision of the country's future, began making efforts to set up this institute in 1975 and approved its establishment in 1979, a month before his death,” Yoon said. “This is the place where Park's spirit is being succeeded.”
President Yoon Suk Yeol burns incense at a memorial shrine of former President Park Chung-hee and his wife Yuk Young-soo in Gumi, North Gyeongsang Province, Wednesday. Captured from North Gyeongsang Province Governor Lee Cheol-woo's Facebook page
During his stay in the city, Yoon visited the house of Park's birth, which was turned into a memorial shrine, and paid tribute to his predecessor.
The president wrote in the visitor register book, “I will never forget the great future envisioned by the great leader, and will pursue it with the people.”
According to North Gyeongsang Province Governor Lee Cheol-woo, Yoon said the memorial shrine is “too small” and asked him to come up with ways to expand it.
The former president is credited with leading Korea's industrialization in the 1960s and '70s, but has also been criticized for his iron-fisted rule over the country for 18 years.
Park is father of former President Park Geun-hye, who was ousted in 2017 due to a corruption scandal. Yoon was one of the prosecutors who led investigations into the younger Park.