According to several sources, electronics giant, Samsung says the company has decided to invest $18.6 billion in South Korea so that it can maintain its lead in the memory chip and next generation smart phones business. The announcement comes as a relief for South Korea as it will create half a million jobs in the country.
This investment further strengthens the determination of Samsung to stay ahead in the business of manufacturing memory chips and smart phones, which will catapult the organization into the third most valuable company in Asia. From time to time, Samsung has been known to invest around $10 billion every year to ensure it sustains its leadership position in the business and stays ahead of competition like SK Hynix and Toshiba Corp.
This announcement was in response to frantic calls by South Korean President Moon Jae-in who emphasized having large corporations invest in South Korea and create jobs in the domestic market. The company has indicated that this investment will create around 440,000 jobs in South Korea by 2021.
From shareholders’ point of view, this news comes as a big relief after the organization underwent a turbulent time because of its ongoing case of bribery by Vice Chairman Jay Y Lee.
Analyst Park Ju-Gun from CEO Score commented that its high time companies like Samsung started concentrating on the domestic (South Korean) market, after it announced the opening of a $380 million plant in USA.
As per the latest spending plan, Samsung will be pumping in around $14 trillion that it won for its NAND project in Pyeongtaek by 2021. It is also planning to invest in a semi-conductor project in Hwaseong, which is a $6 trillion investment. However, the company has not revealed the timelines for starting the project.
Analysts are commenting that this huge investment will create a surplus of products, but will in no way cause a reduction in the prices because the demand is still high.
Anirudh M. for TechFunnel.com