South Korea's SME and Startups Minister Lee So-young has highlighted a significant profit gap between the country's largest semiconductor companies and their smaller suppliers. According to a ministry analysis, operating profits at major chipmakers are approximately 10 times those of small and medium-sized enterprises (SMEs) in the supply chain.
The analysis found that 89% of additional revenue at major chip companies converts into operating profit, compared with just 30% at smaller suppliers. The minister said higher semiconductor selling prices have not translated into comparable price increases for lower-tier vendors.
Following a presidential review meeting on the government's mega project programme, the ministry outlined several measures to strengthen smaller businesses. These include regional SME councils, â‚©2 trillion in win-win funding by 2030, a â‚©5 trillion smart manufacturing initiative, and â‚©2 trillion in regional growth funds.
