Semiconductor boom driving gentrification in Seoul, presidential policy chief warns; investment plans in semiconductors, physical AI and robots to be unveiled Monday

Kim Yong-beom, chief of the presidential policy office. [Yonhap]
Kim Yong-beom, chief of the presidential policy office. [Yonhap]

Kim Yong-beom, chief of the Cheong Wa Dae policy office, said Friday that the massive profits generated by the semiconductor boom are driving gentrification in Seoul.

Speaking on the YouTube program "Kim Eo-jun's Humility Is Hard News Factory" that morning, Kim said the surge in liquidity "is leaving many ripple effects," adding that the government is "doing everything it can to stabilize the real estate market."

Gentrification refers to the process by which upscale housing and large commercial and cultural facilities move into areas that were previously underdeveloped or dominated by low-income residents and small businesses.

Kim drew on the social problems that accompanied London's rise as a global financial hub to express concern about South Korea's future.

"In London, people who don't work in finance and don't earn $500,000 or $1 million a year can no longer afford to live there," he said. "If you study your heart out, graduate from a top university, and still can't afford even a 33-square-meter apartment, how can anyone accept that? Can society hold together?"

He went on to say that as money pours in from the semiconductor boom, "people who don't work in the core sectors are bound to be pushed out," calling the situation "not normal" and arguing that housing price pressures "must not be allowed to concentrate only in certain areas."

Kim added that the government would "supply everything that can be supplied" in terms of real estate, and also emphasized the case for basic income, citing remarks by Demis Hassabis, CEO of Google DeepMind.

"Enormous tax revenues are going to come in, and we need to design a way for the public as a whole to benefit from some of that," he said. "We need to build a program that recirculates the semiconductor profits."

Kim also predicted that the surge in corporate revenues from the semiconductor boom would drive rapid growth in South Korea's gross national income per capita.

Asked by the host whether a GNI of $40,000 or $50,000 per person could arrive much sooner than expected, Kim said he has "a projection for what GNI will look like and what our standing will be in a few years," and answered: "Yes."

Regarding the Three Mega-Projects National Report to be held at Cheong Wa Dae on Monday, Kim hinted that the event could produce the largest investment announcement in the country's history, saying "the numbers that come out of the briefing will feel unfamiliar."

Kim identified the three mega-projects as semiconductors, physical AI and robots, saying the event "will be an occasion to present programs developed through the joint efforts of the government and businesses, and specific investment plans will be disclosed."

"Starting from the question of whether the numbers are real, debate will intensify," he said. "Each company will also explain well why such large figures are being announced." He added that the government plans to hold a series of regional briefings following the event. Chey Tae-won, chairman of SK Group, is scheduled to unveil a large-scale investment plan in Gwangju on Tuesday, while Lee Jae-yong, chairman of Samsung Electronics, is set to do the same in South Chungcheong Province on Thursday.

Kim also appeared to address claims from some quarters that the large-scale investments are being concentrated in the Honam region due to government pressure, saying: "These are the world's top one and two companies — you can't squeeze results out of them just by applying pressure."


sang@heraldcorp.com