China Offers Extensive Support to Display Makers
China is about to dominate the global OLED display as well as LCD market. Experts point out that China’s rapid rise in the industry is based on extensive government support and the South Korean government is failing to provide comparable support.
According to the Korea Display Industry Association, the Chinese government provides land, water and electricity free of charge during display plant construction and provides subsidies for Chinese display companies so that their manufacturing equipment purchase cost can be close to zero. Bonuses are given to those meeting production yield targets and subsidies are provided for those in the red. For example, from 2016 to 2020, BOE and CSOT were given 1.6 trillion won and 920 billion won, respectively.
In 2018, BOE started the mass production of 10.5th-generation LCD panels for the first time in the world, which is the starting point of China’s global display market domination. BOE invested 40 billion yuan in building related manufacturing facilities and the local government of Hefei covered 45 percent of the investment with local financial institutions covering another 45 percent with interest rates close to zero. Nowadays, the Chinese government is shifting its focus towards OLED display.
According to experts, the South Korean government is indifferent unlike the Chinese government. Display has never been included in its national strategic technologies subject to additional tax incentives related to R&D and facility investment.