Samsung and SK Hynix plan $647.5bn Korean chip expansion
South Korea’s top two chipmakers are preparing a $647.5 billion domestic investment drive that will deepen Asia’s grip on the AI memory chips European industry relies upon.
Samsung Electronics is expected to pledge 1,000 trillion won, roughly $647.5 billion, for domestic investment over the next decade. The announcement, scheduled for 29 June at the presidential office, will also feature rival SK Hynix unveiling its own spending plans. Executives from both companies are set to appear alongside President Lee Jae Myung.
Around 300 trillion won of Samsung’s total is earmarked for new chip factories in South Korea’s southwest. Seoul has been pushing for a second chip cluster in precisely this region, aiming to move fabrication and jobs away from the crowded capital area. The remaining capital will fund artificial-intelligence data centres, batteries, and display technologies, forming a portfolio that closely mirrors state industrial policy.
For European tech and industrial sectors, the scale of this commitment underscores a stark supply chain reality. The continent remains heavily reliant on Asian giants for high-bandwidth memory, the specialised chips essential for training and running AI accelerators. By committing to massive domestic factory expansions, South Korea’s national champions are cementing their control over these critical components for the next decade.
The AI boom has fundamentally reshaped the competitive dynamics between the two Korean rivals. SK Hynix recently overtook Samsung as South Korea’s most valuable listed company by capitalising on surging demand for high-end memory. Samsung, for its part, crossed a $1 trillion market capitalisation earlier this year. The upcoming announcement gives SK Hynix a platform to match its larger rival’s ambitions in front of a global audience.
Investors should, however, view the headline figure with a degree of caution. Spread across ten years, the annual outlay aligns closely with Samsung’s existing capital expenditure levels rather than representing a sudden, massive spike in spending. Packaging multi-year plans into a single, striking number is a common corporate practice, particularly for events designed to signal political alignment.
The sheer size of the planned investment is already having secondary economic effects. South Korea’s policy chief has warned that the windfall could inflate regional housing costs near the new clusters. The precise details of both companies' plans remain unconfirmed until the executives take the stage, and final allocations could still shift.
