(Bloomberg) -- South Korea will join its largest companies including Samsung Electronics Co. to pour some $422 billion into areas such as chips and electric vehicles in its most aggressive effort yet to win a heated global race for tech supremacy.

The government will focus support on chips, batteries, robots, electric vehicles, displays and biotechnology in an investment plan through 2026, President Yoon Suk Yeol said Wednesday. The blueprint includes the creation of hubs housing chipmaking mega-plants, design houses and material suppliers to bolster the country’s own supply chain.

That would provide an initial kick for Samsung, which now plans to spend about 300 trillion won ($229 billion) over the next two decades to build a new chipmaking complex on the outskirts of Seoul. The world’s largest memory maker is investing heavily in its foundry capabilities in a bid to challenge far-bigger rival Taiwan Semiconductor Manufacturing Co. as the center of global chip manufacturing.

“The economic war that began recently in semiconductors is broadening to advanced industries such as batteries and cars of the future,” Yoon said in a televised briefing. “Each country is sparing nothing in large-scale subsidies and tax benefits to build cutting-edge manufacturing facilities at home.”

The acceleration of funding comes as policymakers from Washington to Beijing throw billions of dollars into a race to build up domestic production lines, after pandemic shortages laid bare the risks of depending on a global supply chain for linchpin technologies. The US has been leading efforts to build chip production capacity in America, but companies are now weighing the strings attached to government support.

Samsung’s investment would be the core part of Korea’s push. The company plans to build five memory and foundry fabs in a new chip cluster in Yongin by 2042, where it seeks to attract more than 150 local and foreign chip companies.

Samsung, along with SK Hynix Inc., together dominate the world’s memory-chip market. Korea, which also leads in promising arenas such as organic light-emitting diode (OLED) displays, is also home home to carmaker Hyundai Motor Co. and display maker LG Electronics Inc. But the country is still largely dependent on foreign firms for materials, parts and equipment needed to assemble chips and other products, said Lee Chang-Yang, Korea’s Minister of Trade, Industry and Energy. 

Korea’s tech leadership faces growing challenges as memory chips and displays become increasingly commoditized, and as the US and China — the world’s two largest economies — increase spending to boost domestic production capacity. 

“The hegemonic competition between the US and China over cutting-edge tech is turning into a full-blown war,” Lee said, adding that Japan and Taiwan are also spending more to support tech industries.

South Korea has been strengthening its economic ties with the US and reducing its reliance on China. Samsung has been aggressively expanding its most advanced plants at home in Pyeongtaek. It also plans to build a new foundry in Taylor, Texas, by 2024, and has been mulling several possibilities for future factories, including Texas and Europe.

(Updates with comments from government officials and more background)

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