Korean tech giant Samsung has said that the company plans to invest $230 billion over the next 20 years in a new chip-making base in the country.

The semiconductor industry is currently dominated by Taiwan, which produces over 60 per cent of the world's semiconductors and over 90 per cent of its most advanced ones. Most of this comes from one company, the Taiwan Semiconductor Manufacturing Corporation (TSMC). However, increasing political tensions surrounding the island have led companies and governments from around the world to develop their own national chip industries.

South Korea is one of the biggest proponents of this, with its government on Wednesday revealing a 550 trillion won private-sector investment plan. The Samsung project is worth around 300 trillion won, with Seoul saying that the smartphone maker would create the world’s largest chip-making base.

The industry ministry said that Samsung’s plan will develop five factories which will attract up to 150 materials, parts and equipment makers, fabless chip makers and semiconductor research-and-development organisations near Seoul.

The South Korean government’s plan also looks to expand tax breaks for tech firms and raise competitiveness of sectors including displays and batteries. In addition to investing in the private sector, the government will budget a minimum of 25 trillion won over five years for R&D in technologies such as artificial intelligence.

Announcing the scheme, South Korean president Yoon Suk Yeo said: "The economic battlefield, which recently began with chips, has expanded ... countries are providing large-scale subsidies and tax support.

"(We) must support private investments to ensure further growth ... the government must provide location, R&D, manpower, and tax support."

The US is also looking to bolster domestic chip manufacturing. Last month, the US government released details of the CHIPS and Science Act, a $52.7 billion investment in domestic semiconductor manufacturing.

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