South Korea declared that its support package for the nation's crucial semiconductor sector had increased to 33 trillion won ($23.25 billion), up around 25 percent from the 26 trillion won package that was revealed the previous year.
Calls for the government to increase support during a period of increasing policy uncertainty under the current U.S. administration and growing rivalry from Chinese rivals prompted the actions.
The goal of South Korea's decision to invest more in its vital chips industry is to assist businesses in managing higher expenses as they compete on a global scale.
The world's leading memory chip manufacturers, Samsung Electronics and SK Hynix, are based in Asia's fourth-largest economy, albeit they have lagged behind some competitors in fields like contract chip manufacturing and chip design.
According to government statistics, South Korea's semiconductor exports totaled $141.9 billion in 2024, or 21 percent of the nation's total.
$46.6 billion and $10.7 billion, respectively, were shipped to China and the US.
In addition to saying that there will be flexibility with certain semiconductor businesses, US President Donald Trump announced on Sunday that he would be revealing the duty rate on imported chips over the course of the next week.
In order to minimize any negative effects on domestic businesses, Finance Minister Choi Sang-mok stated in a meeting on Tuesday following the announcement that the government would aggressively consult with the US over its Section 232 investigations into imports of semiconductors and biopharmaceuticals.
In an effort to lessen the impact of US tariffs on the auto industry, which has witnessed years of steadily increasing exports to the US, South Korea announced emergency support measures for the sector last week.
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Along with tax breaks and subsidies to increase domestic demand, the measures include financial support for the auto industry. The government also pledged to work with the United States to expand markets and engage in negotiations.