Business News for June: FDI, Government and Policy
Updated: Sep 5
Foreign Direct Investment
Dutch chip firm ASM to invest USD 100 mln to build new facility in S. Korea
Dutch semiconductor equipment maker ASM will invest USD 100 million to build a new production and research and development center in S. Korea by 2025, a top executive said on May 23. The decision underscored ASM's commitment to expanding business in S. Korea, the second largest semiconductor market with 19 percent of global industry sales as of 2021. The country is home to Samsung Electronics Co. and SK hynix Inc. The new Hwaseong facility will be used for production of equipment for atomic layer deposition, a key process in chip manufacturing, and research and development, like the current facility in the city. With the new one, ASM's R&D space in S. Korea will grow by twofold and production space by threefold.
Canada pledges USD 220 million aid for POSCO Future M’s JV battery plant
S. Korea’s POSCO Future M Co. said on May 30 that the Canadian government will provide significant funding to support the construction of its Ultium CAM electric vehicle battery plant, a joint venture with General Motors Co. in Becancour, Quebec. POSCO Future M and GM formed the joint venture in July 2022 and are investing about USD 633 million to build a 30,000 tons per year cathode production plant in the region located about halfway between Montreal and Quebec City. The plant will be the largest battery cathode production facility ever built in Canada. According to POSCO Future M, both the federal government of Canada and the government of Quebec have pledged financial support for the project during a joint announcement at the construction site of the Ultium CAM battery plant. Local media outlets, including CTV News, reported that the Quebec government will contribute USD 112 million, while the federal government will provide USD 108 million in financial support for the project.
Government & Policy
S. Korea to extend 14 tln won of support to prop up auto parts industry
The S. Korean government and major carmakers will extend combined support worth more than KRW 14.3 trillion won (USD 10.9 billion) to the auto parts industry for technology development and securing necessary liquidity in the latest move to boost exports and ensure stable supply chains in the broader industry, the industry ministry said on May 23. During a roundtable meeting with private auto and auto parts companies, the government announced a set of supportive measures for the sector, as the country has enjoyed solid growth in exports of vehicles and auto parts and the global demand for S. Korean products is forecast to rise further, according to the Ministry of Trade, Industry and Energy. Under the plan, the ministry and carmakers will provide auto parts companies with over KRW 14.3 trillion of funds to help support their investment and secure necessary liquidity through policy financing and joint development projects. The supportive measures are expected to help grow the country's production of electric vehicles about fivefold by 2023 and lead to innovation in other next-generation industries, such as system semiconductors, software, displays and bio, according to the industry.
*This article is extracted from Invest KOREA information center, 2023