It is not very hard to make the case that Seoul is overly concentrated for both politics and the economy at the expense of other areas of South Korea. And as far as security balwark goes, Seoul is only 40km from the DMZ.
So it's quite an organic decision to select such a location, as also all the suppliers and customers are already located in this region.
Relocating to an entirely different region would just delay the process and actually risk to collapse the economy for quite mundane reasons.
Other Industries have their center of weight located more south, like Automotive and Energy.
One "mundane reason" to imagine the complexity:
People now working in semiconductor sector all live around Seoul. Apartments in Korea are not rented but predominantly purchased on loan.
Just announcing to pull a whole industry further away from Seoul would immediately drive up housing prices of the destination and collapse the housing prices in Seoul. So people selling to relocate could not pay off their loans with that money and could not acquire at the destination due to huge debt. Seoul real-estate market could collapse, and since most of it is owned on loan, it would at least immobilize the whole Seoul region (as people could not relocate without risking bancrupcy), at worst cause banks to no longer accept the apartments as sufficient security for the loan.
Moreover, Seoulites really, seriously, desperately don't want to move out. The government has tried many times to create new cities away from Seoul with stable public-sector jobs; but a lot of people who work in Sejong, for example, just keep living in Seoul and make the 250km round trip every day. The 300K who actually moved to Sejong didn't make a dent in housing prices anywhere else, either.
That’s a win for the average person in Seoul. Housing prices are destroying this generation of young people.
Isn’t China one of the most prominent examples of using real estate as investment? There’s even whole ghost towns of apartment buildings that are constructed for this purpose.
Evergrande Group is emblematic of the real estate industry’s trouble there. Property is 15-30% of Chinese GDP and much of it goes towards investment property.
No. Koreans and Chinese both love propping up property as an investment.
Japanese are the ones who don't, as their system is vastly less investment oriented and less expandable.
Tanking a bunch of their own investments doesn't sound like a great idea.
It's just that leaving Seoul is not worth it for anyone involved.
That's why basically any large project basically NEED to be within X minutes of a major city. The saving in land cost setting it up in a rural area is nothing compared to having no staff, no services, no infrastructure, local political problems etc.
Side note but isn't water a critical input for a fab? Arizona's water problems are going to continue to get worse so this seems like a bad move by Intel.
I'm never sure when it comes to water. I think a lot of places in the west chose to have shortages by refusing to build infrastructure and wasting supply on subsidizing things like (export orientated, unnecessarily high water use forms of) agriculture. But I am no expert...
Over half of South Koreans live in the Seoul Capital Area. That’s a much higher proportion than countries other people often accuse of being overcentralized and neglecting the regions, like the UK with London or France with Paris.
And to some degree what you describe is a self fulfilling prophecy; big cities hollowing out the smaller ones, shrinking their economies and leaving their governments in deficit and the services worse, rinse and repeat.
Bigger cities are just more efficient and effective.
I will say that you might have the cart before the horse, cities are a product of the efficiencies / benefits.
Seoul is extremely large, at 26M. Reversing even some of the flow would largely still be aiming at million plus cities in South Korea, of which there are five outside the Seoul Capital Area.
Making people move, to a place that already has well documented housing and transportation shortages, is not really fair. Unequal GDP per capita is not fair either, particularly since that means less ability to pay for services, which are generally lower quality and much further away from homes.
SK government had probably one last chance to reverse its course, when it tried to move the administrative capital to Sejong in 2003, but it was met with hard backlashes including a very creative constitutional decision. Keep in mind that Sejong is not very far from Seoul anyway, and yet it failed; Sejong does host many administrative facilities, but is short from being the capital in any sense.
Cities in this size range in East Asia all have massive fertility issues (Tokyo, Seoul, Shanghai, Beijing)
This is the kind of radical bat shit craziness, from posters who are so intelligent they can rationalize anything, craziness that I love to find on HN.
I went to high school in a specialized class in Sweden anyway and I didnt have any internship because if you study all your waking hours to get max grades you don't have time for interning.
Germany famously lacks a dominant city and has a pretty good economy. So does the US. Decentralization is also diversification; if one region is falling behind it does not take the whole country with them.
In general also many East-Asian cities don't really suffer from dysfunction and lack of development so agglomeration really has a lot of upsides.
The "tools" themselves are an extra level of crazy. For one, the ASML x-ray ("EUV") laser lithography machines are just an unbelievable piece of precision engineering. If twenty years ago you had told me that we'd have high-power x-ray lasers in an industrial setting with nanometer focusing precision I would have laughed in your face, or assumed that it's a function of a particle accelerator the size of a decent town.
I remember seeing an add for a new-generation tool (machine) designed for the permanent vacuum part of the production line. They were proudly showing off their key improvement, which was that its MTBF was something like 7 hours. This was amazing apparently, because both them and their competition couldn't do much better than 40 minutes previously!
Think about how demanding the requirements must be that a 40 minute MTBF was state of the art and totally acceptable in large-scale manufacturing, and raising that to "still less than a day" is worthy of advertising in an industry magazine!
They want workers and they want Seoul. Workers want Seoul and they don't want to rely on their employers. This is always going to continue the fueling of Seoul border growth.
The country has been overconcentrated in Seoul since at least the beginning of the dictatorship. Breaking the cycle will not happen overnight, and you don’t even need to build new cities, just invest in the other ones. (Sejong was probably a bad idea.)