Build infrastructure first for Honam chip fabs

A day after President Lee Jae Myung called for a “blitzkrieg” approach, the government on Tuesday announced a goal of completing the first phase of semiconductor fabs in Honam by 2029.

Minister of Trade, Industry and Resources Kim Jung-kwan unveiled the target at a Cabinet meeting at the Government Complex Sejong. Yet the goal came before schedules were finalized for the Gwangju military airport site, which requires consultations with the United States, or for electricity and water infrastructure.

“First-phase completion” appears to mean finishing at least one of four fabs that Samsung Electronics or SK hynix is expected to build in Honam by 2029. After more than six months of trial operations, that could fulfill presidential chief of staff Kang Hoon-sik’s pledge for completion within Lee’s term. Making production visible before then could also provide the ruling camp with an achievement to tout in future elections.

But securing electricity and water infrastructure is far harder than constructing a fab. A semiconductor plant can be built in about three years, while transmission networks for large industrial complexes take an average of 13 years from planning to completion.

Of 54 major transmission and substation projects linked to the 11th Basic Plan for Long-Term Electricity Supply and Demand, 20 are delayed by resident complaints, local government permits and other obstacles.

China, which is rapidly catching up with Korea, builds electricity and water infrastructure before fabs arrive. Korea must at least develop power, water and roads alongside factory construction, as was done for TSMC’s plant in Kumamoto, Japan. Otherwise, the 2029 target will be difficult to achieve.

The Honam fabs alone would require 650,000 tons of industrial water a day, more than Gwangju’s daily household water supply. A consistent infrastructure plan must come first.

The fragmented administrative structure also needs reform. The Ministry of Land, Infrastructure and Transport handles national industrial complexes and transportation networks, the Ministry of Climate, Energy and Environment oversees electricity and household and industrial water, while the Ministry of Agriculture, Food and Rural Affairs manages agricultural water, which accounts for 63 percent of Korea’s water use.

A government-wide central authority is needed to coordinate infrastructure strategy across ministries. The government should establish a timetable and assign responsibility for power, water, roads and permits before construction begins.

Having the president personally step in as a troubleshooter whenever individual problems arise may win applause from supporters. But that is far from an efficient or successful way to carry out policy. If the government is serious about the 2029 target, it must prove first that the infrastructure needed to operate the fabs can be completed on time.