South Korea’s government earmarked 27 per cent more funding to support the country’s chip industry, raising a previous allocation to KRW33 trillion ($23.2 billion) due to rising trade friction with the US and increasing competition from China, Reuters reported.

The government also intends to increase a financial assistance programme for the sector by 17.6 per cent to KRW20 trillion, the news agency stated.

China accounted for 32.8 per cent of South Korea’s $141.9 billion in chip exports in 2024, while the US imported 7.5 per cent, Reuters wrote citing government data.

The US government is expected to announce the tariff rate on imported chips soon.

Last week, the nation temporarily exempted smartphones, computers and a range of other products from reciprocal tariffs.

Nearly a year ago, the South Korean government committed KRW26 trillion to support the country’s chip industry.