Deputy PM Koo Yun-cheol: 'We will achieve an ultra-gap Korea'

Industry Minister Kim Jung-kwan: 'All infrastructure will be swiftly supported'

Climate Minister Kim Sung-hwan: 'Up to 1 million tons of water per day can be secured'

Deputy Prime Minister and Minister of Finance and Economy Koo Yun-cheol [Yonhap]
Deputy Prime Minister and Minister of Finance and Economy Koo Yun-cheol [Yonhap]

As discussions continue over plans by Samsung Electronics and SK hynix to build a semiconductor cluster in the Honam region, the government has pledged full support for the project, with the deputy prime minister and the ministers of trade and climate all committing to provide power, water and other critical infrastructure.

Analysts say a semiconductor cluster in the Honam region is an inevitable choice given the saturation of land, water and power infrastructure in the greater Seoul area and the need for balanced regional development. However, concerns have also been raised that the hundreds of trillions of won in investment required means companies will face considerable risk in securing key talent and building the materials, parts and equipment ecosystem needed to support semiconductor factories.

According to the Ministry of Finance and Economy on Sunday, Deputy Prime Minister and Finance and Economy Minister Koo Yun-cheol posted on X (formerly Twitter) on Saturday, ahead of the formal announcement of Samsung Electronics and SK hynix's investment plans for semiconductor facilities in the Honam region. Under the heading "We respect companies' decisions to invest in the regions, and the government will back them with everything it has," Koo pledged that "the key battleground for an ultra-gap advantage is the regions, and we will support them with full force."

He added that the government would "respect the companies' judgment and accelerate the development of the Yongin semiconductor cluster as much as possible," and that it "must push with full force to expand future semiconductor production bases in regions where local energy production and consumption is possible."

Koo also promised to "activate a pan-government, all-out support system so that the regional investment, which has been difficult to get off the ground, can quickly bear fruit."

Industry Minister Kim Jung-kwan also posted on Facebook on Saturday regarding the two companies' planned investments, saying he understood that "the southwestern region has been recognized as a competitive candidate site due to its high rate of energy self-sufficiency, abundant water resources, and strong research and talent base — including Chonnam National University, the Gwangju Institute of Science and Technology and the Korea Institute of Energy Technology."

Kim stressed that "this decision by the companies is not simply a matter of building one fab," calling it "an investment that will elevate Korea's semiconductor competitiveness to the next level, a national project that will narrow the gap between the greater Seoul area and the regions, and create a new growth foundation for the southwestern region, which was relatively left behind during industrialization."

He pledged that "the government will swiftly support all infrastructure — including sites, power, water and roads — so that the companies' planned investments can proceed without a hitch," and that it would "work closely with local governments on permits and approvals to create an environment where companies can focus solely on their investment."

Climate, Energy and Environment Minister Kim Sung-hwan posted on X on June 27 in response to growing questions about whether securing industrial water for the Gwangju and South Jeolla Province semiconductor industrial complex would be feasible. He explained that "seven dams in the Yeongsan River and Seomjin River basins hold about 1.5 billion tons of water, and these dams can supply 3.37 million tons per day for residential, industrial, agricultural and river maintenance use."

He added that "more than 1 million additional tons of water per day can be secured," according to ongoing reviews.

Kim did not specify the concrete measures by which more than 1 million tons per day could be secured. However, he alluded to "adjusting dam water systems and utilizing spare capacity," signaling an intent to first address what he called phantom demand.

Kim Yong-beom, the Cheong Wa Dae policy chief, also posted on X on Sunday, citing "unused water allocations that have been over-distributed for decades" as one of the water resources available in the Honam region.

According to a report by the National Assembly Research Service, actual water use from 2015 to 2019 was limited to 37.6 percent of permitted river water allocations — 9.66 billion tons used annually against a permitted 25.66 billion tons. In South Jeolla Province, the ratio of actual use to permitted allocation was even lower, at 29.3 percent, with 834.18 million tons used against a permitted 2.84 billion tons per year.

The government is also understood to be reviewing raising the height of existing dams to increase their storage capacity — a measure known as "dam heightening." Should that proceed, calls are expected to emerge for reviving dam construction projects that were pursued but canceled or delayed under previous administrations.

Climate-response dam candidates pursued under the Yoon Suk Yeol administration in the South Jeolla Province area include the Dongbokcheon Dam in Hwasun-gun, the Okcheon Dam in Suncheon and the Byeongyeongcheon Dam in Gangjin-gun.

Of these, the Dongbokcheon and Okcheon dam projects were suspended, while the Byeongyeongcheon Dam project was put on hold pending a review of its scale and other details.

The Dongbokcheon Dam would involve building a new dam between the existing Juam and Dongbok dams, meaning any revival could face significant local opposition and environmental concerns. The Okcheon Dam, by contrast, would expand an existing reservoir — the Waryong Reservoir — making it a comparatively less contentious option.

Minister Kim drew a line against two proposals that have been floated in some quarters: piping water from other regions into Honam, and seawater desalination.

"Supplying water from other regions or desalinating seawater differs from what the government is currently reviewing," Kim said.

Desalination has drawn particular skepticism: with current technology, converting one ton of seawater into fresh water requires about 3.6 kilowatt-hours of energy — six to 12 times the energy needed for conventional water purification — making it a poor fit for semiconductor industrial complexes that are already notorious for their enormous power consumption.


oskymoon@heraldcorp.com