A fund of 300 billion won will be provided to foster domestic semiconductor small and medium-sized enterprises and fabless companies.

The Ministry of Trade, Industry and Energy announced on the 26th that it had signed a business agreement (MOU) for the launch of the ‘Semiconductor Ecosystem Fund.’

This MOU involved the Ministry of Trade, Industry and Energy and the Financial Services Commission from the government, and Samsung Electronics, SK Hynix, Korea Growth Finance Corporation, Semiconductor Industry Association, Industrial Bank of Korea, and KEB Hana Bank from the private sector.

This fund will be created with a scale of 300 billion won, the largest compared to existing funds, taking into account the high depletion rate of the semiconductor-only fund currently in operation.

In addition, we plan to support the scale-up of promising fabless and small and medium-sized enterprises by increasing the scale of project investment compared to existing funds, and actively support technological advancement through activation of mergers and acquisitions (M&A).

The fund will be managed by Korea Growth Finance Corporation, and it is expected to begin investing within the year after going through the process of selecting a sub-fund management company.

First Vice Minister of Trade, Industry and Energy Jang Young-jin, who attended the signing ceremony, said, “The government recognizes the increasingly fierce global semiconductor leadership competition as a wartime situation and is doing its best to provide support that does not fall behind competitors,” adding, “We are increasing investment tax credits to stimulate semiconductor investment, introducing special provisions for easing the floor area ratio, and increasing the 300-year system semiconductor competitiveness.”He emphasized, “We are pursuing unprecedented support measures, such as establishing a state-of-the-art system semiconductor cluster of the scale of 10 trillion won and establishing the Advanced Semiconductor Technology Center (ASTC) as a new technology test bed for the localization of fabless and small and medium-sized enterprises.”

In addition, he said, “The ‘Semiconductor Ecosystem Fund’ launched today is intended to support the growth and self-reliance of fabless and small and medium-sized enterprises that are experiencing difficulties in raising investment capital due to recent interest rate hikes and deteriorating business conditions. We hope that this fund will serve as a catalyst for the birth of a Korean-style Nvidia that will lead the future semiconductor industry.”