On Sunday, major South Korean companies, including Samsung Electronics, announced new domestic investment plans during a meeting with South Korean President Lee Jae-myung. Lee hoped these measures would alleviate concerns that South Korean companies might shift their investment focus to the United States following a trade agreement between the US and South Korea.
Days before Lee Jae-myung met with business leaders, the South Korean government finalized a trade agreement with the United States, pledging to invest $350 billion in U.S. industries to avoid the Trump administration imposing the highest tariffs on the country.
Global chip giant Samsung announced it will invest 450 trillion won (approximately $310 billion) over the next five years to expand its domestic business, including building a new production line at its Pyeongtaek manufacturing base to meet the demands of artificial intelligence. Driven by the global semiconductor Demand surged .
Samsung stated that the new production line will begin operation in 2028, as part of a broader effort to secure additional capacity, given anticipated market demand for memory chips. The medium- to long-term demand will continue to rise. Samsung also plans to build artificial intelligence data centers in Jeollanam-do and Gumi. This is to support the government's efforts to narrow the development gap between the capital region and other regions.
Hyundai Motor, South Korea's largest automaker, announced plans to invest 125 trillion won ($86.3 billion) between 2026 and 2030 to expand domestic research and development and advance artificial intelligence and robotics. And new technologies such as autonomous vehicles .
Another semiconductor giant, SK Group, along with shipbuilding companies Hanwha Marine and HD Hyundai, also announced increased domestic investment. These two shipbuilding companies are key players in South Korea's commitment to support the development of the US shipbuilding industry—a key area in the US-South Korea trade negotiations.
SK Group Chairman Chey Tae-won stated that the finalization of the US-South Korea trade agreement has eliminated uncertainty and paved the way for bolder domestic investments. The group plans to invest at least 128 trillion won (approximately US$88.3 billion) domestically by 2028, with a focus on the field of artificial intelligence.
During his meeting with business leaders, Lee Jae-myung praised the business community for helping his government negotiate a trade deal with Washington, but at the same time urged these companies to maintain strong domestic investment to alleviate concerns that he was “cutting domestic spending to increase U.S. investment.”
He stated that the South Korean government is exploring various policy measures, including easing regulations, to create a more favorable business environment for enterprises.
The U.S. and South Korean governments released details of a trade agreement last Friday, including a $150 billion South Korean investment in the U.S. shipbuilding industry and an additional $200 billion in other U.S. industries. South Korea stated that to prevent financial instability, this investment will be capped at $20 billion annually.
The United States agreed to include South Korean automobiles and auto parts in its cargo shipments. Tariffs will be reduced from 25% to 15%, and South Korea will be given treatment "no less than" that of its competitors when tariffs are imposed on its semiconductor industry in the future.
(Article source: CLS)
