The government has confirmed the Gwangju military airfield as the site for a Honam-region semiconductor industrial complex, putting the “three mega projects for the AI era” on track. Cheong Wa Dae held a joint public-private inspection meeting on Sunday to wrap up the Honam site selection, the biggest point of contention. It also decided to use increased tax revenue from a semiconductor boom as project funding. A new dedicated body directly overseen by the president will also be set up.

Kang Hoon-sik (강훈식), the presidential chief of staff, said at a briefing after the meeting that it had decided to build the Honam semiconductor industrial complex on the Gwangju military airfield site. He said companies had viewed the Gwangju military airfield as the most suitable location among several candidates in the Honam region.

The site will cover about 2.5 million pyeong. Kang cited as an advantage that the site is already levelled because it is an airfield, which can sharply reduce the construction time needed before breaking ground. He said proximity to central Gwangju and a KTX high-speed rail station would make it easier to secure workers, and that housing conditions are in place for employees to live there. Logistics access linking roads, the airport and ports was also reviewed as strong.

The government will also speed up an expansion of the Yongin semiconductor cluster. It will shorten land compensation and schedules to supply power and water as much as possible so that investment in 10 planned fabs can be brought forward. With the Yongin general industrial complex set to begin operation next year, it aims to advance as much as possible the start of the subsequent national industrial complex to respond to surging global semiconductor demand. Measures to secure talent and improve living conditions such as housing, transport and education were also discussed along with core infrastructure such as power and water.

◆ New 'future response fund' using semiconductor tax revenue

Project funding will come from the semiconductor boom. The government on Saturday unveiled a plan at a high-level ruling party-government policy meeting to set up a “future response fund” using additional semiconductor tax revenue. It plans to use the funding not only to support the three mega projects but also to support housing, start-ups and jobs for the 2030 youth generation. The three mega projects refer to semiconductors, artificial intelligence data centres and physical AI, among others.

President Lee Jae-myung (이재명) repeatedly stressed at the meeting that “only a speed race matters.” He warned against delays in administrative procedures, saying that even though the Yongin industrial complex was considered relatively fast, it took 6 years from site confirmation to groundbreaking. He said that did not seem fast.

Lee urged that instead of the practice of following procedures in sequence, multiple procedures should be carried out at the same time within legal bounds. He said that if so-called “land holdouts” occur in land acquisition, negotiated purchases and compulsory acquisition procedures should be launched together. He also suggested using results of existing environmental impact assessments for the same area. He proposed securing power and water in advance rather than waiting for other procedures to finish.

Lee promised to do the maximum possible, including fiscal support, given the large amount of excess tax revenue generated in the semiconductor sector. He also called for cooperation from local governments that hold a significant share of licensing authority. Lee expressed thanks, noting that the Jeonnam-Gwangju Special City Council enacted an ordinance for semiconductor-investing companies as its first ordinance.

Lee also pushed back against some criticism of the projects. He said that one side protests, on the premise that they can be realised, by asking why its region was left out, while another side argues the projects are an “impossible event.” He said he wished they would do only one of the two. He added that even if they could not cooperate as much as possible, he hoped they would not significantly interfere.

The meeting was attended by Finance Minister Koo Yun-cheol (구윤철), who also serves as deputy prime minister for the economy, and Industry Minister Kim Jeong-gwan (김정관), among other ministers. From industry, Samsung Electronics President Kim Yong-kwan (김용관) and SK Hynix CEO Kwak Noh-jung (곽노정) attended. Cheong Wa Dae said it will place a dedicated body for the mega projects within Cheong Wa Dae and hold a joint public-private inspection meeting chaired by the president on a monthly basis.