South Korea Plans To Spend 200 Billion Won For Automotive Chip Technology

The government of South Korea has disclosed its people its plan of spending 200 billion won, or more than 170 million dollars, for the development of automotive chip-making technology.

The said move is part of the country's desire to encourage the growth of the next generation of the vehicle sector.

Hong Nam-ki, the finance minister of South Korea, stated through a report by The Korea Herald that the government is looking forward to speaking with local automakers in the hope of finding ways to solve the on-going supply shortage of automotive chips.

He even revealed that it is one of the objectives of the South Korean government to invest in developing automotive application processors.

As of the moment, the country is still trying to cope with the current global shortage of automotive chips amid the novel coronavirus pandemic. Based on a report by The Daily Star, South Korea has been simplifying customs procedures for automotive chips since February.

"As automotive chips are key parts of the car industry and demand for future-generation cars is high, it is urgent to ease a short-term supply shortage of such chips, enhance supply channels and preempt the market," Hong quipped.

In realizing the objective of South Korea in terms of automotive chip technology, the government will consider permitting state-run banks to offer loans that have low-interest rates for automotive chip-related purposes.

This way, more automotive companies will be encouraged to expand their business, especially since the shortage is expected to run until the third quarter.

South Korea is known for being the number one and most trusted exporter of automotive chips in the world. However, the making of such items depends mostly on overseas sources.

It is now looking to expand cooperation with partners from other parts of the world who are specializing on an automotive chip technology as well.