Samsung to Announce $20 Billion US Foundry Plant This Week... Lee Jae-yong's Bold Moves for New Samsung and National Interest (Comprehensive)

Samsung Electronics Vice Chairman Lee Jae-yong (right) is taking a commemorative photo with Satya Nadella, CEO of Microsoft, at Microsoft's headquarters in Washington State, USA, on the 20th (local time).
[Photo by Samsung Electronics]

[Asia Economy Reporter Kim Heung-soon] Samsung Electronics is expected to announce its second semiconductor plant in the United States within this week. Lee Jae-yong, Vice Chairman of Samsung Electronics, who is visiting the U.S., held successive meetings in Washington D.C. with senior White House officials and key members of the U.S. Congress to discuss overall semiconductor supply chain issues, including the second semiconductor plant. Vice Chairman Lee is scheduled to return around the 24th, after which the final announcement of the plant location is expected.

Discussion of 'Strategic Cooperation' with Key White House Officials
Meetings with Federal Lawmakers... Request for Cooperation on Semiconductor Legislation

According to Samsung Electronics on the 21st, Vice Chairman Lee met with senior White House officials on the 19th (local time) to mainly discuss solutions to global semiconductor supply chain issues and federal government incentives for semiconductor companies. It is reported that there was also extensive discussion about Samsung's role in resolving semiconductor supply chain problems.

Earlier, the U.S. Department of Commerce requested 'semiconductor supply chain data' from 79 global companies including Samsung Electronics. Samsung Electronics submitted the data before the deadline. Vice Chairman Lee and key White House officials reportedly reached a consensus on the need for 'strategic cooperation' between the two governments and private sectors, focusing on future growth industries such as 5G networks and biotechnology.

Separately, Vice Chairman Lee also met with senior officials of the U.S. federal government to exchange views on major issues. It is extremely rare for the White House to individually invite foreign company representatives and arrange meetings with key aides. The business community views this as a confirmation of Vice Chairman Lee's and Samsung's global stature.

It is understood that Vice Chairman Lee also met with key members of the U.S. Congress on the 18th to discuss current issues. A source from the U.S. Congress who met with Vice Chairman Lee said, "The plant location has been narrowed down and an official announcement is expected soon." The lawmakers Vice Chairman Lee met are reportedly key figures responsible for semiconductor incentive legislation. It is said that Vice Chairman Lee requested cooperation for the passage of semiconductor incentive-related bills during the meeting.

Samsung Electronics announced plans to build a new foundry (semiconductor contract manufacturing) plant in the U.S. to contribute to the economies of both countries by establishing a supply chain in advanced manufacturing at the ‘Korea-U.S. Business Roundtable’ event held in Washington D.C. last May. To this end, it plans to invest $17 billion (about 20 trillion KRW), the largest investment ever made in the U.S. Samsung has been negotiating incentives with candidate locations including Taylor and Austin in Texas, Arizona, and New York. Among these, Taylor quickly approved incentive plans such as tax breaks, emerging as the leading final candidate location.

Samsung Electronics Vice Chairman Lee Jae-yong (left) is taking a commemorative photo with Noubar Afeyan, co-founder and chairman of the board of Moderna, in Cambridge, Massachusetts, USA, on the 16th (local time).
[Photo by Samsung Electronics]

Full Effort to Discover Future Growth Engines Including Bio, Telecommunications, and Semiconductor IT

After completing meetings in Washington D.C., Vice Chairman Lee moved to the U.S. West Coast to meet consecutively with executives of global ICT companies such as Microsoft (MS) and Amazon, discussing cooperation plans for future strategic businesses. This followed business meetings on the East Coast on the 16th and 17th with top executives of Verizon, the world's largest mobile telecommunications company, and Moderna, a global biotechnology company.

On the 20th, Vice Chairman Lee met with Satya Nadella, CEO of Microsoft, and exchanged views on cooperation in next-generation technologies such as semiconductors, mobile, virtual reality (VR), augmented reality (AR), and the metaverse, as well as expanding the software ecosystem.

Previously, Vice Chairman Lee shared strategies and discussed cooperation plans with Nadella CEO in 2018 during Nadella’s visit to Korea, focusing on core areas of the Fourth Industrial Revolution such as artificial intelligence (AI) and cloud computing. The two also attended the Sun Valley Conference in Idaho, U.S., together in July 2016 and have maintained frequent contact through phone and video conferences since then.

Vice Chairman Lee then visited Amazon and exchanged broad views on next-generation promising industries including AI and cloud computing. Amazon participates in the 'HDR10+' camp, a next-generation image quality technology led by Samsung Electronics. They also maintain a technological cooperation relationship, providing AI 'Alexa' for Samsung Smart TVs. It is reported that the executives of both companies reached a consensus on expanding cooperation in innovation through this meeting.

First Official Meeting as Samsung’s Head
Diligently Fulfilling Role as a 'Private Diplomat' Considering National Economy

Vice Chairman Lee’s visit to the U.S. is the first in 5 years and 4 months since attending the Sun Valley Conference in July 2016. This time, as the head of Samsung, he met consecutively with local business leaders as well as key political figures in Washington D.C., playing the role of a 'private diplomat' contributing to stabilizing the global supply chain and enhancing friendly relations between Korea and the U.S.

Previously, Vice Chairman Lee was the first Korean businessman to serve as a full member of the U.S. Department of Commerce advisory body, the 'Business Council,' in 2013. The Business Council was established in 1933 by then U.S. Secretary of Commerce Daniel Roper to seek advice on business operations. It is a forum where CEOs from various industries discuss current issues and exchange ideas.

The business community views Vice Chairman Lee’s U.S. visit as a move considering the national economic situation and global economic environment, which the government cited as grounds for his parole. Earlier, the Blue House stated at the time of Vice Chairman Lee’s parole in August, "In the midst of a severe crisis, especially in the semiconductor and vaccine sectors, many citizens expect his role and request parole," adding, "We hope the public understands this as a choice for national interest."

This content was produced with the assistance of AI translation services.