South Korea wants to strengthen the chips from China and Trump

South Korea intends to improve its financial support for local hijacking companies next year, in an effort to support this sector in light of policies that could be unfavorable from the administration of newly -elected US President Donald Trump, in addition to an increasing competition from Chinese enterprises. The South Korean Finance Ministry announced in a statement on Wednesday that financial support – which will include loans, insurance and guarantees by state institutions – will reach $ 14.3 trillion ($ 10.2 billion) next year, as part of continuous policy to motivate the sector. It also indicated a plan to cover a ‘large part’ of a cost of 1.8 trillion to bury the underground electricity cables in the manufacturing centers of the slides south of the capital Seoul. In July, South Korea launched a 26 trillion aid package, and part of it is devoted to the support package planned for the next year. In addition, the government plans to increase the tax credit rate for companies that work by 10 percentage points in the semiconductor sector, and the establishment of a National Center for ‘Artificial Intelligence Computer’ with a value of 4 billion won by 2030. supported in the United States. chains. While the state continued to provide financial support to chips manufacturing companies, Trump’s election was an incentive to accelerate the protection of the growth of this vital sector. In its statement, the ministry confirmed that there were possibilities for the growing economic uncertainty after the new US administration took over, despite the possibility of American-South Korean relations in areas such as defense and shipbuilding. In the same context, Samsung Electronics, the largest South Korean company, is building a semiconductor factory in Texas, supported by funding within the “Chips and Science and Science Law” approved by the administration of President Joe Biden. It is noteworthy that Trump repeatedly criticized this program during his campaign. According to the Ministry of Finance, South Korea also faces an increasing competition from China. The ministry also indicated that the increasing protectionist policy could affect the South Korean economy, which depends much on the trade. Technology exports form about a third of South Korean consignments abroad. The country’s economy is expected to grow at least 2% this year compared to 2023, driven by strong demand for semiconductors, especially on memory chips used to develop artificial intelligence technologies. However, economic expectations for the next year seem less optimistic, especially with the decline in exports in recent months. Officials are also afraid that Trump will take strict positions against the United States trade partners as soon as he held office in January.