Seeking new growth drivers, Samsung plans US$22b spending on new tech

Nichole VegaAug 11, 2018

Samsung and its affiliated companies plan to spend $US22 billion ($A30 billion) over the next three years on artificial intelligence, auto components and other future businesses. It represents a six percent increase over the past three years.

It will also develop a range of system-on-chips for autonomous driving based on its semiconductor, telecoms and display technologies products, as well as build new chipsets to support AI, 5G and data centres.

The company said it expected to add 40,000 new jobs over the next three years, in news that will likely bring relief to South Korea's government which is now struggling with high youth unemployment.

Samsung Electronics will primarily fund $22bn of that investment to underpin research into artificial intelligence (AI), 5G connectivity, electronic components for automotives and biopharmaceuticals. AI seems to be the main concern.

"Today's announcement follows many months of deliberations and review by the management and board of directors of different Samsung companies that will make the investments, including Samsung Electronics", said the company.

Chung said reformist President Moon Jae-in's campaign to clip the wings of the country's powerful family-run conglomerates, known as chaebols, appeared to be losing steam in the face of stonewalling business groups which are "wielding prospects for investment as their weapons". "It will continue to invest heavily in the businesses, including developing and manufacturing biosimilars to combat chronic and difficult-to-cure diseases". The platform will benefit 500 projects - 300 external candidates and 200 inside the company - in the next five years to encourage innovations and entrepreneurship.

Vice-chairman Mr Lee met Mr Moon at the Indian factory's opening this year, his first meeting with the nation's leader since Mr Lee was released in February on a suspended jail sentence for a graft conviction. Shares in the group's information technology services affiliate Samsung SDS (018260.KS) rose almost 6 percent.

Samsung made the announcement to help revitalize the South Korean economy and foster new growth engines, Xinhua reports.

Samsung Electronics shares were little changed.

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