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AI-Driven Memory Chip Demand Reshapes Global Semiconductor Supply and Spurs Chinese Expansion
Nov. 20, 2025 | Technology & Innovation

Recent shifts in semiconductor investment reflect the impact of AI-driven demand and strategic capacity expansions worldwide.

**AI-driven demand for high-bandwidth memory (HBM) chips led Samsung and SK Hynix to reallocate production capacity from mainstream DRAM toward HBM, creating significant shortages in DRAM for mobile phones, PCs, and servers.**
As these manufacturers ramp up HBM output to support accelerating AI applications, DRAM supply constraints have emerged, pushing memory spot prices sharply higher and contributing to an industry phenomenon known as “chipflation.”

**Rising memory costs are driving up end-product prices across the tech sector.**
PC prices could climb by as much as 15% next year, while smartphone component expenditures are projected to increase by 5–7%. TrendForce analysts warn that these elevated costs may dampen consumer demand, potentially cutting smartphone production by 2% and laptop manufacturing by 2.4% in 2026. According to their estimates, low-margin, low-cost smartphones face the greatest risk.

**Major PC vendors already feel the impact.**
Dell’s memory procurement completion rate may fall to around 40%, raising the risk of delivery delays. In response, Morgan Stanley downgraded Dell’s stock outlook, and both Dell and HP suffered steep share price declines once they disclosed memory shortages and impending price hikes.

**Chinese smartphone manufacturers are encountering acute DRAM shortages and scrambling to secure supplies amid intense competition.**
In contrast, large technology companies such as Apple have largely insulated themselves by relying on long-term memory supply contracts. The scramble among Chinese OEMs has led to reduced orders for local foundries like SMIC.

**Domestic Chinese memory chipmakers are seizing these shortages to expand aggressively.**
Yangtze Memory Technologies Co. (YMTC) has launched government-supported investments to boost its NAND flash capacity, targeting the world’s fourth-largest producer position within two years. This push aligns with Beijing’s strategy of nurturing domestic semiconductor champions. Unlike Samsung and SK Hynix, which have signaled only modest capacity increases for DRAM and NAND, Chinese firms are pursuing more ambitious growth plans. As global memory demand continues to rise, these producers may capture additional market share. Samsung’s Xi’an NAND flash facility and SK Hynix’s Wuxi DRAM plant in China already supply substantial portions of their companies’ global output, and ongoing government subsidies and investments in domestic fabs should further strengthen China’s role in the global memory supply chain.
Samsung Accelerates 1c DRAM Production Expansion Amid Rising Global Demand
Nov. 20, 2025 | Technology & Innovation

Korean chip makers are significantly expanding their DRAM production capabilities to address growing market demand.

**Samsung Electronics will ramp up its 10-nanometer-class 6th-generation DRAM (1c DRAM) output from 60,000 wafers per month at the end of 2025 to roughly 200,000 wafers per month by the end of 2026.**
The company plans to add 80,000 wafers by mid-2026 and another 60,000 wafers in the final quarter through process conversions in existing lines and fresh investments at its Pyeongtaek Plant 4 (P4).

**This enlarged 1c DRAM capacity will account for about one-third of Samsung’s current total DRAM production, which stands at 650,000–700,000 wafers per month.**
Samsung’s commitment reflects confidence in 1c DRAM technology and aims to alleviate a tight supply not only in high-bandwidth memory (HBM) but in mainstream DRAM—where buyers have begun pre-purchasing unproduced stock to secure future supply.

**Samsung’s 1c DRAM devices will feature circuit linewidths of 11 nanometers or less and incorporate multiple layers of extreme ultraviolet (EUV) lithography.**
The goal is to mass-produce next-generation DRAM that delivers both higher performance and lower cost.

**On November 16, Samsung unveiled a broader investment plan of 450 trillion won over five years to secure memory semiconductor capacity as artificial intelligence drives demand higher.**
The company intends to scale production proactively, enabling rapid responses to market shifts.

**This investment push also targets the restoration of Samsung’s position as the world’s top DRAM supplier, a title currently held by SK hynix following Samsung’s recent HBM supply and sales setbacks.**
Samsung representatives say they are reviewing various measures to meet surging demand but have not confirmed the precise allocation of additional funds.

Monitored Intelligence for South Korea - Nov. 21, 2025


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Gov't investigation finds widespread labor abuses against foreign workers

Joongang Ilbo | English | News | Nov. 21, 2025 | UndeterminedEmployment

A government investigation in South Korea has revealed widespread labor abuses against foreign workers, with 93 percent of inspected workplaces violating labor laws. The Ministry of Employment and Labor conducted two rounds of inspections in April and September 2025 at 196 workplaces vulnerable to worker mistreatment, uncovering 846 breaches across 182 workplaces. Common violations included unpaid wages at 123 sites, excessive working hours at 65, failure to provide breaks or holidays at 22, and assault or discriminatory treatment at 10.

Unpaid wages amounted to 1.7 billion won ($1.16 million), with 103 of the 123 workplaces repaying 1.27 billion won. Serious cases led to criminal charges, such as an assault case in South Chungcheong and wage evasion in Gangwon. Additional violations included failure to enroll foreign workers in mandatory insurance and inadequate dormitory facilities. Three workplaces hiring foreign workers without permits faced restrictions on future employment authorizations.

The ministry issued 844 corrective orders and plans to conduct further inspections, particularly targeting repeat offenders. Findings will be shared with key stakeholders to promote voluntary improvements in labor conditions. Labor Minister Kim Young-hoon emphasized that there should be no distinction between Korean and foreign workers in labor rights protection and committed to establishing an integrated support system for foreign workers.

Gov't doubles budget for rural basic income pilot program following local backlash

Joongang Ilbo | English | News | Nov. 21, 2025 | Protest, Demonstration, Dissent

The South Korean government has doubled the budget for President Lee Jae Myung’s rural basic income pilot program due to backlash from local governments excluded from the initial trial. The Ministry of Agriculture, Food and Rural Affairs’ 2026 budget plan was approved with a 1.17 trillion won increase, raising funding for the basic income initiative from 170.3 billion won to 340.9 billion won. This allows for up to five additional trial regions and increases the central government's contribution rate from 40 to 50 percent.

The program provides 150,000 won per person monthly for two years to residents in population-declining rural areas, aiming to revitalize these communities. Of 69 eligible counties, 49 applied but only seven were selected initially, sparking protests and concerns about fairness and resident outflow. Some regions, such as Cheongyang County, experienced temporary population increases possibly linked to the cash benefits. Local governments have also requested higher state subsidy rates due to limited fiscal capacity.

Experts warn of significant fiscal risks if the program expands nationwide. Covering all 69 population-declining counties could cost 4.9 trillion won annually, with roughly 2 trillion won borne by the central government. Extending it to the entire rural population of 9.64 million could raise spending to about 6 trillion won per year. Critics highlight the risk of mandatory cash welfare spending limiting future local investments, with relatively low economic impact compared to infrastructure spending, and caution against the program becoming an unsustainable fiscal burden.

홍진배 IITP 원장, AX2.0 시대 국가전략 제시

Hong Jin-bae, IITP Director, Presents National Strategy for the AX2.0 Era

ZD Net Korea | Local Language | News | Nov. 21, 2025 | UndeterminedTech Development/Adoption

On November 19, Hong Jin-bae, Director of the Institute for Information and Communications Technology Planning and Evaluation (IITP), presented South Korea’s R&D and talent strategy for the AX 2.0 era at a seminar held at Korea National Open University. The event focused on the policy, ecosystem, and talent development directions needed for South Korea to establish itself as a sustainable AI future nation amid increasing global competition centered on national strategy and technology sovereignty.

Kim Jin-hong, chairman of the ICT Renaissance Committee, highlighted the structural limitations in the Korean AI ecosystem, describing it as trapped in a “scale-up trap” marked by insufficient private investment and talent outflow. He advocated for a government role shift from “market fixer” to “market creator” to better cultivate the domestic AI ecosystem.

Director Hong Jin-bae explained that AI is evolving from simple inference in the AX 1.0 era to autonomous action in the real world in the AX 2.0 era, with agentic and physical AI driving a new productivity revolution across sectors such as manufacturing and services. He noted the competitive shift towards efficiency and usability, emphasizing AI’s growing importance in national sovereignty amid US-China technological rivalry.

Hong outlined three strategic pillars for South Korea’s advancement as an AI leader: securing technological sovereignty in six core AI fields (AI models, semiconductors, quantum computing, cybersecurity, next-gen networks, and AI convergent services); leveraging manufacturing strengths by enhancing full-stack physical AI technologies for early market leadership; and cultivating high-level innovative talent through initiatives like AI Star Fellowship and specialized graduate programs. These efforts aim to build national innovation capabilities to lead the next productivity revolution.

The seminar included experts from AI, security, telecommunications, industry, and medical fields who discussed practical measures for developing a Korean-style AI innovation ecosystem. An IITP official noted that the seminar helped redefine the national AI strategy’s direction in response to the AX 2.0 era, focusing on technological sovereignty, R&D reorganization, and talent cultivation necessary for South Korea’s progress as an AI-leading country.

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