Samsung breaks its piggy bank and announces USD 356 billion in investments
It’s a broad investment plan of USD 356 billion over the next five years. Samsung Group has the ambition to become a leader in a wide range of sectors, from semiconductors to biological products.
The financial package builds on and strengthens the USD 205 billion plan announced last summer. It also represents an increase of more than a third over the previous five years of investment.
Samsung the technology king plans to create 80,000 jobs by 2026 “mainly in core businesses, including semiconductors and biopharmaceuticals,” Samsung said in a statement.
The Korean giant is the largest conglomerate in South Korea and its global turnover is equivalent to one-fifth of the national gross domestic product.
Samsung is already the world’s largest smartphone maker through its flagship subsidiary Samsung Electronics.
Thanks to this investment plan, Samsung will be able to count on “long-term growth in strategic sectors and help strengthen the global industrial ecosystem of fundamental technologies,” said Samsung.
Samsung also assured that these investments would “advance the mass production of chips based on the 3-nm process,” the latest technology that further reduces the size of semiconductors and increases their computing power.
There will be further massive investments made in Samsung Biologics and Samsung Bioepis subsidiaries in this area.
Almost 80% of the five-year plan, which is worth 450 trillion won, will be invested in South Korea.
It is not insignificant that the announcement comes just days after US President Joe Biden visited Samsung Electronics’ huge semiconductor plant in Pyeongtaek during his first Asian tour.
President Biden highlighted the South Korean company’s role in securing global microchip supply chains.
South Korea and the United States must work to “maintain the resilience, reliability and security of our supply chains,” Biden said, calling semiconductors made in the country a “marvel of innovation” and crucial to the global economy.
The American president was accompanied on the assembly line by South Korea’s new president Yoon Suk-yeol and Lee Jae-Yong, vice president of the company and de facto head of the Samsung conglomerate. The latter introduced his VIP guests to a live audience, which was his most important public appearance since his release on parole in August.
The Coreen group employs nearly 20,000 people in the United States and is building a factory in Texas scheduled to open in 2024, a USD 17 billion investment.
The big investment plan is announced two weeks after Yoon, a big supporter of family-owned conglomerates, known as chaebols, was inaugurated as president of the country.
“This is a classic way for Korean companies to make a call for a new president,” Park Ju-gun, director of Leaders Index, a Seoul-based research institute, told Bloomberg News, referring to the Samsung announcement. Investors need to check whether the promised amount of investment is actually executed or not.”