Samsung to Pump $22.3B Into AI, 5G, New Tech

The spending will boost research and expenditure in artificial intelligence fifth-generation wireless networks bio-pharmaceuticals among other things

Samsung has announced that it will invest 25 trillion Korean Won, or $22 billion into innovative industries such as artificial intelligence, 5G, automotive electronic parts, and biopharmaceuticals.

Of the total, KRW 130 trillion (around Rs. 7.97 lakh crores) will be spent in South Korea, and is expected to create 40,000 jobs, or 20,000 more than its previous hiring plans, Samsung said.

The South Korean tech giant said it made a decision to expand investment to revitalize the national economy and foster new growth engines.

"Today's announcement shows Samsung is serious in its efforts to develop new growth engines" at a time when its semiconductor business and mobile sector are both facing mounting competition from Chinese rivals, Greg Roh of HMC Securities & Investment told AFP.

Samsung Electronics, the world's top maker of memory chips and smartphones and the group's flagship company, did not provide a breakdown of the figures but said it will provide most of the investment.

The company said the investment made locally will have the effect of creating some 700,000 jobs, especially from the chip and display industries.

It forms part of a broader strategy under which the Samsung group will invest KRW180 trillion ($160.7 billion) in total over the next three years in capital expenditure and research and development.

"Samsung's brimming with cash right now", said Kwon Sung-ryul, an analyst at DB Financial Investment in Seoul. The company also will expand C-Lab, its internal venture incubation program, and work with the Korean government to establish and run software education centers across the country.

Samsung said it already helped 1,086 companies adopt smart factory solutions from 2015 through 2017, with the beneficiaries observing an average 5.5 percent increase in their sales.

Samsung Electronics shares were marginally down in afternoon trade against a flat Kospi index. Its de facto leader Lee Jae-yong was convicted of corruption a year ago, but released from prison in February.

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