Lee meets executives to boost domestic manufacturing investment

President Lee Jae-myung met Nov. 16 with leaders of Samsung, SK, Hyundai Motor, LG, HD Hyundai, Celltrion, and Hanwha to urge increased domestic investment and job creation. The meeting followed the conclusion of South Korea-U.S. tariff and security negotiations, with Lee calling on companies to actively counter potential manufacturing hollowing from a surge in U.S.-bound investment. Major corporations responded with ambitious plans to invest in South Korea.

The tariff agreement allows South Korean exports to compete with Japanese and European Union products in the U.S. market, but it also imposes significant investment burdens on both companies and the government. In addition to a government-led $200 billion investment, corporations are expected to commit $150 billion to MASGA (U.S.-South Korea shipbuilding cooperation) projects and another $150 billion in semiconductor, automotive, and secondary battery investments, all confirmed during the Trump administration.

The combined investment by the government and corporations totals $500 billion, roughly equal to next year’s national budget. Corporate commitments alone reach $300 billion, equivalent to three years of domestic manufacturing facility investment, which totaled $100 billion this year. Even if carried out in phases, these obligations could constrain domestic investment capacity and reduce the number of high-quality jobs.

In this context, the willingness of leading companies to expand domestic investment is encouraging. Samsung plans to accelerate its spending by completing a state-of-the-art semiconductor factory at its Pyeongtaek campus in Gyeonggi Province by 2028 to meet AI-era demand. SK Group is preparing to boost investments in its Yongin semiconductor cluster and other facilities. Hyundai Motor Group announced plans to invest 125.2 trillion won domestically by 2030, exceeding previous commitments by more than 8 trillion won, with a focus on automotive facilities, AI, and robotics. LG Group reaffirmed its five-year plan to invest 100 trillion won. HD Hyundai and Hanwha Ocean plan to expand domestic shipyards and U.S. facilities simultaneously to strengthen their cooperative system.

Investments directed toward the U.S. pose a significant threat to South Korea’s manufacturing base, which ranks sixth globally. However, if Korean companies can successfully enhance domestic research and development capabilities and productivity, they could maintain competitiveness and strengthen South Korea’s position as a manufacturing hub in the global supply chain. The government and political leaders should not merely encourage domestic investment verbally but provide clear policy measures to support companies’ willingness to take on these challenges.