SEOUL -- The South Korean government announced on Thursday that it will provide more tax benefits to the country's chipmakers to boost their competitiveness amid a critical global shortage of the key components.

The Finance Ministry said that it will raise the tax deduction ratio for semiconductor research and development investments by big companies to 40% from the current 30%, paving the way for Samsung Electronics and SK Hynix to benefit from the eased financial burden. The chipmakers also will enjoy higher deductions for investments in facilities as the government is doubling that ratio to 6%.

"We will actively support corporations' investments through the tax code to make our semiconductor industry lead global supply chain competition," the ministry said in a statement.

The announcement comes one month after President Moon Jae-in hosted a meeting with executives in the semiconductor, auto and shipbuilding industries to discuss how to strengthen their global position.

The timing is also critical as Moon will depart for the U.S. next week for a summit with President Joe Biden at the White House on May 21. The presidential Blue House said that the two leaders will discuss economic and trade cooperation, with analysts expecting chipmaking to be a key issue in the dialogue.

Market watchers say that Samsung Electronics is likely to announce its plan to invest about $17 billion in building new foundry chipmaking lines in Austin, Texas, where it already has a facility, or elsewhere the country during Moon's visit. Samsung is planning to expand its foundry business to catch up with rival Taiwan Semiconductor Manufacturing Co.

Samsung is the world's biggest memory chipmaker, accounting for 42% of market share in DRAM chips and one-third in NAND chips. However, it is chasing TSMC in the foundry business, where the Taiwanese company leads the market with a share of more than 50%.

On Thursday, Samsung said in a news release that it will increase investments in its system LSI and foundry businesses to a total of 171 trillion won ($151 billion) through 2030, to "accelerate research into cutting-edge semiconductor process technology and construction of a new production facility."

The company said that the figure is an increase of 38 trillion from its previous plan announced in April 2019.It added that its expects the spending will boost its goal of leading the world in logic chips by 2030.