S.Korea seeks tax cuts for U.S. investment by firms such as Samsung

·2 min read
FILE PHOTO: The logo of Samsung Electronics is seen on a dish washer at its store in Seoul

By Joyce Lee

SEOUL (Reuters) -South Korea has requested U.S. incentives such as tax deductions and support for stable electricity and water supply to ease investment by Korean firms including leading chipmaker Samsung Electronics, its presidential office said on Friday.

South Korean President Moon Jae-in, in Washington for a summit with U.S. President Joe Biden, told a gathering of U.S. Secretary of Commerce Gina Raimondo, her Korean counterpart and CEOs of Qualcomm, Samsung, and other executives that both countries can benefit by strengthening supply chain cooperation.

Biden has advocated for support for the U.S. chip industry amid a global chip shortage that has hit automakers and other industries.

He met with executives from major companies including Samsung in April and previously announced plans to invest $50 billion in semiconductor manufacturing and research.

Samsung plans to invest $17 billion for a new plant for chip contract manufacturing in the United States, Samsung vice chairman Kinam Kim said according to South Korea's presidential Blue House, confirming plans previously reported.

In February, documents filed with Texas state officials showed that Samsung is considering Austin, Texas, as one of the sites for the $17 billion chip plant that the South Korean firm said could create 1,800 jobs.

There has been no new public documentation filed on the potential Texas chip plant application since March, the website for the Texas Comptroller of Public Accounts showed on Friday.

At Samsung's existing Texas chip plant, a shutdown caused by blackouts from a winter storm in the first quarter affected wafers corresponding to around 300-400 billion won ($266-$355 million) of damages, Samsung previously said.

The U.S. Department of Commerce and the Korean industry ministry agreed on Friday that for continuous chip industry cooperation, policy measures such as incentive support, joint research and development and cooperation on setting standards, and manpower training and exchange are needed, the Blue House said.

Meanwhile, DuPont announced plans to establish an R&D center in South Korea to develop original chip technologies such as photoresist for extreme ultraviolet (EUV) lithography, the Blue House said in a statement.

($1 = 1,126.8500 won)

(Reporting by Joyce Lee; Editing by Louise Heavens, Emelia Sithole-Matarise and Bill Berkrot)