‘Semiconductor Special Act’ enforcement decree's exclusion of Seoul area sparks backlash

Gyeonggi Province and its 31 constituent cities are strongly opposing a provision in the enforcement decree of the Semiconductor Special Act that designates "regions outside the Seoul metropolitan area" as eligible for semiconductor cluster development. The province argues this clause unfairly excludes the entire Gyeonggi region, which is part of the Seoul metropolitan area, from crucial administrative and financial support, tax incentives, and deregulation benefits. This exclusion, they contend, undermines local governments' semiconductor growth strategies and jeopardizes projects involving global companies. Cities like Osan, concerned about delays in research park development with Applied Materials, and Bucheon, facing potential disruptions in foreign investment talks centered around DB HiTek, have voiced their worries. Seongnam highlighted policy confusion regarding its "fabless growth strategy," while Gwacheon and Siheung warned of a weakened ecosystem for AI and new industries. The existing infrastructure, built around major companies like Samsung Electronics and SK Hynix, is also at risk. Pyeongtaek fears negative impacts on attracting related industries and developing its hinterland around Samsung's plants. Hwaseong is concerned about the designation of a "third specialized complex for materials, parts, and equipment," and Suwon anticipates difficulties in promoting its research-focused area and free economic zone centered on Samsung. Even areas like Yeoncheon and Gapyeong, which face regulations due to military facilities and border proximity, feel further disadvantaged by being categorized solely as part of the metropolitan area. Goyang and Uijeongbu are worried about weakened development strategies for economic zones and returned military sites, while Gimpo fears a decline in its future growth engines in advanced industries. Experts involved in drafting the special act and Gyeonggi Province officials criticize the decree's clause as self-damaging to the nation's semiconductor competitiveness. "The semiconductor industry's core is speed and execution, and uniformly excluding the Seoul metropolitan area is not desirable," stated Hyun Byung-cheon, Director of Gyeonggi Province's Future Growth Industry Bureau. The province is establishing a joint response system with its cities and plans to coordinate with Seoul and Incheon to exert pressure on the government for revisions. Gyeonggi Province has already submitted its opinion to the Ministry of Trade, Industry and Energy, demanding the removal of the exclusionary and preferential treatment clauses for non-metropolitan areas. They are activating a dedicated "Semiconductor All-Care Task Force" to develop tailored responses for various regions within the province, from production hubs like Yongin and Pyeongtaek to materials and parts cities like Ansan, Hwaseong, and Osan, and regulated areas in northern and eastern Gyeonggi.

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The semiconductor industry's core is speed and execution, and uniformly excluding the Seoul metropolitan area is not desirable.