Semiconductor Industry

Samsung Invests $6.4 billion towards Texas’ Semiconductor Industry

Asia Korea

The US Department of Commerce has invested $6.4 billion to Samsung Electronics' semiconductor sector in Texas.

On April 15th, 2024, the US Department of Commerce signed a non-binding agreement with Samsung Electronics that invested $6.4 billion towards strengthening the semiconductor industry in Texas. Samsung is a South Korean company that is a leader in the semiconductor industry that excels both in memory and advanced logic technology. The $6.4 billion is part of the 2022 CHIPS and Science Act, that was created to stimulate growth and advancement for the semiconductor sector in the US.

The funding will lead to a creation of around “17,000 construction jobs and more than 4,500 manufacturing jobs.” The United States depends on East Asia for more than 75% of its advanced chips, so the government is making active efforts to create a sustainable and competitive semiconductor industry in the country – and this initiative is aimed towards bolstering that initiative.

Samsung is projected to invest over $40 billion in the United States in the upcoming years. Having previously made ample investments in Texas, Samsung aims to become the state's top semiconductor producer by further developing and centralizing its presence in Texas. The plan is to split the funding between the cities of Taylor and Austin in Texas and to boost and increase semiconductor efficiency and production. The goal for the city of Taylor is to become a high-tech manufacturing center that will develop into a centralized hub for semiconductor production. The center would include two advanced factories that will produce 4nm and 2nm chips and be focused on research and development for future versions of the chips. It would also serve as a packaging location that creates sophisticated semiconductor packaging technologies necessary for Artificial Intelligence, like 3D High Bandwidth Memory. For Austin, the funding will improve the current facility’s ability to manufacture advanced silicon-on-insulator chips, which are vital for US weapons defense systems.

To ensure there is a skilled labor force capable of contributing and participating in these new chip production facilities, Samsung has also previously invested $3.7 million in the University of Texas, Austin and $1 million in Texas A&M University. The US Department of Commerce’s recent investment in Samsung, which in turn props up Samsung’s continued commitments and projects in Texas, continue to bolster Texas’ relationship with South Korea and stimulate economic growth. State exports to Korea have supported a total of 49,844 jobs, with 29,111 jobs directly supported and 20,733 jobs indirectly supported. The continued collaboration between Texas and Samsung not only provides economic benefits for the United States and South Korea, but also reinforces their partnership and alliance.

Tatiana Ostwalt is a Young Professional at the East-West Center in Washington DC. She recently completed a Master of International Affairs from Columbia’s School of International and Public Affairs, where she studied International Economic Policy and Data Analytics and Quantitative Analysis as a STEM degree, and East Asia.