[Issue Plus] Samsung Electronics Co., Ltd., Presidential Personnel Management Co., Ltd.a semiconductor reformer

■ Host: Lee Yeo-jin, anchor Jang Won-seok
■ Starring: Jeong Cheol-jin, economic critic

* The text below may differ from the actual broadcast content, so please check the broadcast for more accurate information. Please specify [YTN News PLUS] when quoting.

[Anchor]
Samsung Electronics, which announced its performance along with rumors of a crisis and an unusual apology, made a presidential personnel appointment.

It has focused on restoring competitiveness by deploying a new head of semiconductors, but it is pointed out that there are many challenges. Let's point out the related content with Chung Chul-jin, an economic critic. Welcome.

Samsung Electronics has replaced the management of its semiconductor division and major business units in the personnel management of the presidents, what are the characteristics of this personnel management?

[Jung Chuljin]
What happened today was the president's greeting. I think it can be compressed into two main characteristics of the presidential personnel that came out this time. First of all, the memory division was attached under the DS division head, Jeon Young-hyun, who is in charge of semiconductors, to oversee memory. What does this mean? Isn't it that Samsung Electronics' biggest weakness is that it hasn't been able to win Nvidia's delivery contract because it hasn't met demand yet? First of all, I left it to Jeon Young-hyun, the head of the department, and I drove it to this side. In terms of the overall system, the first feature is that Jeon Young-hyun and Han Jong-hee two-top systems were established in the past under the one-man vice chairman Han Jong-in, and in the meantime, the foundry will just give up because it is less than HBM3 in the market. There were even a lot of talks that Samsung Electronics would give up, but Han Min-gu, vice president of the U.S. semiconductor market, was promoted to the president of the foundry division, and one of the two promotions said hello. Looking at this, Chairman Lee Jae-yong and Samsung Electronics have no intention of abandoning the foundry yet, but rather, I think we can think of two pillars to read the will to catch up with TSMC as much as possible on the foundry side.

[Anchor]
What message do you think Chairman Lee Jae-yong wants to convey internally and externally through this personnel appointment?

[Jung Chuljin]
So far, I don't think this is clear. There was a greeting from the presidents today. It's the day after tomorrow. On the 29th, executive personnel appointments will come out. However, the entire Samsung Electronics is shaking in terms of executive personnel appointments. It is said that out of about 400 executives, more than 100 or more will be completely replaced. After the executive personnel appointments are over, we need to check the message of Chairman Lee Jae-yong that will come out next. So far, I don't think I can confirm any clear intentions or such.

[Anchor]
However, Samsung Electronics' stock price fell 3.43 percent today. How do I look at this?

[Jung Chuljin]
In fact, regardless of disappointment in presidential personnel, there is the Chip Act, the U.S. Semiconductor Act, which we continued to worry about last night in Trump's transition team. There, it was confirmed that Trump's intention was to not give subsidies to each semiconductor company and semiconductor companies that invested in the United States. Backing that up is President Biden's rush to provide the semiconductor subsidies he originally promised. I paid for Intel.

But what concerns are growing now that this is the case? Isn't it only the company in your country that pays first? Will President Biden be able to give subsidies to Samsung Electronics and SK Hynix in Korea when his term will be over by January next year? So there's one concern that we won't be able to receive at all. Second, if you look at Trump in a big way, he'll do it if he does. However, the Biden administration's Chips Act, which subsidizes investments in the United States, is ridiculous to keep talking consistently. Why would you give me a subsidy? That's how I said it.

So even if the Biden administration actually subsidized Samsung Electronics and Hynix, isn't it possible to take some kind of redemption? Concerns are growing to this point as well. So, because of those concerns, Samsung Electronics was 3.43 percent lower today, while SK Hynix saw a bigger fall. It showed a sharp drop of nearly 5%. First of all, we still need to get the subsidies that President Biden promised when he was there. The reason why
is quite large is that in the case of Samsung Electronics, it is 9 trillion won. Hynix is also a subsidy of more than 1 trillion won if you add up to 630 billion won and 700 billion won in tax benefits. I think we should get this when President Biden is present and receive a deposit. You see, $6.4 billion in subsidies, we get about 9 trillion in our money. Why is that getting it? It invests almost 60 trillion won, and Vice Chairman Han Min-gu, who I mentioned earlier before Taylor City, invests 60 trillion won in foundry and receives 9 trillion won. But one thing is that we invest 60 trillion won, but we don't get that 9 trillion won? In the case of Hynix, if you invest about $3.8 billion now in the range of 5-6 trillion won, but you don't get less than 1 trillion won, this is a huge blow to our Samsung Electronics and Hynix.

[Anchor]
What if you already have some investment in the U.S. and you don't get it, assuming it's actually the worst case scenario?

[Jung Chuljin]
From then on, I think it will be necessary to protest the negotiations with the Trump administration as a government-to-government. It's probably very difficult from then on. You must have already signed a contract while building the factory and done various things. We can't overturn that, and the mayor is talking about Trump as much as possible in his last four years. There's talk of slowing down. Either way, the uncertainty is too great at the moment.

[Anchor]
No matter how much the regime changes, we trust the US administration and invest in it like this. If we change our words like this, won't we be hesitant when we invest in the future because trust in the US will be greatly reduced?

[Jung Chuljin]
However, President-elect Trump has the characteristics that we saw in the first term, but he doesn't take into account such trust or face at all, and the second thing is that what he said seems to be futile, but he has the characteristics that he has achieved similarly as a result, so it seems that the market is reacting this much more.

[Anchor]
The government will also hold a meeting and come up with measures, so what kind of support should there be?

[Jung Chuljin]
There is no clear way at the moment. Because it's an urgent priority to get money during the Biden administration, but I can't even ask for it quickly. First of all, it is a very important point to receive 9 trillion won in advance from Samsung Electronics and 630 billion won from Hynix, as Intel received it yesterday.

[Anchor]
On the other hand, Nvidia CEO Jensen Huang is rushing to approve Samsung's HBM delivery, so what do you think?

[Jung Chuljin]
Because of that, the stock price also reacted. So far, the market doesn't seem to have given some credibility or responded hotly to the issue. Because there have been many rumors that Samsung will deliver HBM3 8th and 12th stages, it has been delivered, but it has never been done. In particular, CEO Jensen Wang's speech this time was a Hong Kong degree ceremony.

And a Bloomberg reporter asked me, and I can't say that I shouldn't, can I? So, the market reacted for a day because it said it would approve it as soon as it came out, but today, the abolition of the Chips Act and the Trump risk were eliminated, so even if the contract for delivery of Nvidia is actually made, I think it's not enough to revive Samsung Electronics' overall fighting spirit, which is falling now.

[Anchor]
And the new city was announced at 1 o'clock, which is receiving a lot of attention from many people, so can you explain it in general?

[Jung Chuljin]
There were 36,000 households. Thirty-six thousand households were evenly identified, including Bundang and Ilsan. I think there are people who worked hard. Bundang has the most. Since there were more than 10,000 households, it accounts for about a third of the total 36,000 households. There were 8,900 households in Ilsan, Middle East, Pyeongchon, Sanbon, etc. Now, experts are talking about the big picture of rebuilding 36,000 households first and then 30,000 households later and completing the reconstruction of the first new city. However, when it comes to business feasibility, there are concerns that the speed of sharing and business feasibility will be a problem except for about 2,000 to 3,000 households in Bundang. So maybe 2,000 to 3,000 households in Bundang are fast from 2027, and the floor area ratio is already high there. I think we can start construction because of our good business feasibility, but the leading district has been decided and is just cheering, but I think it will take a little more time to go through the entire process and sell the land.

[Anchor]
Meanwhile, the Seoul Metropolitan Government allowed the height of the apartment to be up to 250m in the reconstruction of the Apgujeong apartment district and the redevelopment of the residential area in Seongsu-dong. Will it be a signal of the high-rise skyline along the Han River?

[Jung Chuljin]
I think that's possible. There are two right now. In Seongsu, it's from District 1 to District 4. Apgujeong District 2 was included this time, and now the height is very hard to estimate, right? In terms of the number of floors, 70 floors were allowed, I think you can get the concept like this. The limit was about 50 floors, but they said they would release up to 70 floors. In particular, in Apgujeong District 2, there are real apartment complexes and re-regions in Korea, so if this happens, expectations can increase again. The problem is that the construction cost is completely different if it is built under 50 floors, over 50 floors, and over 70 floors. Because building a 70-story high-rise has to be dug deep down. And with safety, construction costs increase exponentially. And the Seoul Metropolitan Government is lifting regulations and opening the market like this, but how fast the project can actually speed up is the future homework, which can be seen as the key. However, you can think of the skyline in Seoul as being partially allowed up to the 70th floor.

[Anchor]
The 70th floor near the Han River. I don't really know what it is, but I think it would be right compared to the 63 Building. If it's like that, it might hurt the view or cause damage. I think there might be this inconvenience.

[Jung Chuljin]
In the former Mayor Park Won-soon's case, such a problem was shared, but this time, considering that only two districts were released, a slightly different political judgment can be interpreted like this.

[Anchor]
So far, I've talked with Jeong Cheol-jin, an economic critic. Thank you.