Samsung commits $356bn in investments with 80,000 new jobs
published : 24 May 2022 at 12:55
updated: 24 May 2022 at 17:53
SEOUL: Samsung Group on Tuesday unveiled a massive $356 billion investment blueprint for the next five years aimed at making it a frontrunner in a wide range of sectors from semiconductors to biologics.
The new figure is an increase of more than a third over its investments spent over the past five years.
The tech giant is South Korea's largest chaebol -- the family-run conglomerates that dominate the economy -- and its overall turnover is equivalent to a fifth of the national gross domestic product.
Samsung Electronics, its flagship subsidiary, is the world's biggest smartphone maker.
The investment plan would bring "long-term growth in strategic businesses and help strengthen the global industrial ecosystem of crucial technology", Samsung said in a statement.
The 80,000 new jobs would be created "primarily in core businesses including semiconductors and biopharmaceuticals" through 2026.
It also noted the investment would "bring forward the mass production of chips based on the 3-nanometer process", the latest technology to further shrink the size of semiconductors and boost computing power.
It will also invest heavily in biopharmaceuticals with its affiliates Samsung Biologics and Samsung Bioepis.
The new plan represents a 36% increase in investment over its total investments over the past five years.
Of the 450 trillion won Samsung plans to spend over the next five years, it will commit 360 trillion won to South Korea.
- Biden visit -
The announcement comes after US President Joe Biden toured Samsung Electronics' massive Pyeongtaek semiconductor factory on Friday, underscoring the South Korean giant's role in securing global supply chains of microchips.
South Korea and the United States need to work to "keep our supply chains resilient, reliable and secure," Biden said, calling semiconductors manufactured there as "a wonder of innovation" and crucial to the global economy.
Lee Jae-yong, the firm's vice-chairman and the de facto leader of the wider Samsung conglomerate, escorted Biden and newly sworn-in South Korean President Yoon Suk-yeol inside the assembly line, and introduced the two to an audience in English.
It was Lee's highest-profile public appearance since his release on parole in August.
He had served more than half of a two-and-a-half-year sentence for bribery, embezzlement and other offences in connection with a corruption scandal that brought down ex-South Korean president Park Geun-hye.
Samsung employs about 20,000 people in the United States and work is under way to build a new semiconductor plant in Texas, scheduled to open in 2024.
The vast majority of the world's most advanced microchips are made by just two companies -- Samsung and Taiwan's TSMC -- both of which are running at full capacity to alleviate a global shortage.
Many major industrial powers such as the United States, Europe, China and Japan are scrambling to build semiconductor plants on their own soil to diversify supplies.
Samsung's massive infrastructure promise comes two weeks after Yoon, a fiscal conservative and a vocal supporter of the chaebols, was sworn in as South Korea's new president.
"It's a classic way of Korean companies to appeal to a new president," Park Ju-gun, head of Leaders Index, a Seoul-based research institute, told Bloomberg News in reference to Samsung's investment announcement.
"Investors need to check whether the promised amount of investments are actually executed or not."