(Corrects investment amount to $28 mln in headline, 1st paragraph)
By Heekyong Yang
SEOUL, Jan 9 (Reuters) - South Korea said on Thursday that DuPont has decided to invest $28 million in the country to produce photoresists and other materials by 2021 - a move that will help reduce its heavy reliance on Japan for the key materials used to produce chips.
Amid a diplomatic row over wartime labourers, Japan in July imposed curbs on exports of three materials including photoresists to South Korea, prompting a scramble among South Korean tech firms to diversify their supply chain.
Last month, Japan reversed the curbs on exports of photoresists, although the tighter curbs on the two other tech materials remain.
"Although Japan has recently eased export controls of photoresists, which is partial progress, but it is not a fundamental solution," South Korea's Industry Minister Sung Yoon-mo said in a statement.
A trade ministry official said DuPont will invest in two existing factories in South Korea and build a new one.
A representative for the U.S. industrial materials maker was not immediately available for comment.
Photoresists are thin layers of material used to transfer circuit patterns onto semiconductor wafers. Japan produces around 90% of photoresists. ($1 = $1.0000) (Reporting by Heekyong Yang; Editing by Hyunjoo Jin and Edwina Gibbs)