The government plans to legally stipulate that the next semiconductor cluster, following the Yongin semiconductor mega-cluster, must be built outside the Seoul metropolitan area. According to reporting by The Seoul Economic Daily on the 15th, the Ministry of Trade, Industry and Energy is preparing an enforcement decree for the Semiconductor Special Act that codifies "areas outside the Seoul metropolitan region" as a requirement for approving semiconductor cluster development plans. The move is a follow-up measure to the Semiconductor Special Act, set to take effect in August, which stipulates that "balanced regional development" must be considered when designating semiconductor clusters.
Limiting semiconductor cluster designations — which carry benefits such as shortened permit timelines and tax credits — to non-capital regions could be a meaningful step toward balanced national development. The government plans to substantially expand benefits for infrastructure such as power and water needed for cluster development to draw corporate investment. However, the possibility cannot be ruled out that location restrictions excluding the metropolitan area could function as yet another rigid regulation hindering corporate investment. Above all, if the plan fails to attract top technical talent to provincial areas, a regional semiconductor cluster could end up as an empty shell. It is worth recalling that the Semiconductor Special Act, first proposed in 2024, included an exception to restrictions under the Seoul Metropolitan Area Readjustment Planning Act precisely as a means to attract specialized semiconductor personnel.
The next semiconductor cluster designation must focus on selecting the optimal location to strengthen Korea's semiconductor competitiveness and providing all-out support. To do so, securing abundant water and power supplies, as well as attracting outstanding specialized personnel, will be key. Beyond simple financial support, education, training and residential environments capable of nurturing and attracting talent must back up the plan if Korea is to capture both goals — strengthening semiconductor competitiveness and balanced national development. On the power issue, authorities must not stop at meeting nominal supply figures on paper but must accelerate the expansion of nuclear power to firmly guarantee 24-hour stable generation and transmission. The semiconductor industry is a core strategic sector on which Korea's economic growth and future national competitiveness depend. Authorities must take a strategic and pragmatic approach to ensure that political considerations do not lead to the selection of an economically inferior site or to setbacks in securing infrastructure.
