Actions speak louder than words

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Actions speak louder than words

Chairing an expanded economy-related meeting for the first time in 15 months, President Moon Jae-in stressed Korean leadership in the global chip supply chain. He vowed “strong support” for a leap towards becoming a “comprehensive semiconductor powerhouse” through the momentum of the super cycle. His awareness of the Korean chip industry and direction amid the contest for tech hegemony between the United States and China is timely.
 
A global war over chips is upon us. The U.S. has been spearheading a push towards a new order in the global chip supply chain to contain China’s fast ascension on the front. America is propping up domestic capacity and sanctioning equipment exports to China. U.S. President Joe Biden mentioned competition with China during the press conference on withdrawing U.S. troops from Afghanistan. Two days before he held a videoconference on semiconductors holding up a wafer in his hand to proclaim “This is infrastructure!”
 
The U.S. has been pulling allies to its side. Biden emphasized partnerships with allies to address new tech and cyber threats to build up a new force of democratic states against China. The White House conference had called upon representatives from non-American chipmakers like TSMC of Taiwan, NXP of the Netherlands and Samsung Electronics and SK hynix. By pronouncing semiconductors as its key infrastructure, Washington is demanding those companies expand their facilities in America.
 
The U.S. administration is out to block the export of chipmaking equipment to China, raising the alarm for Korean companies operating facilities there. It plans to destabilize Chinese vendors like Huawei through Open Radio Access Network (Open Ran) technologies by separating 5G system sand equipment. The U.S. also has been containing China on the EV battery front. China won’t likely sit on its hands as it can weaponize its huge market.
 
Korea must find a way to sustain its leadership on chips and batteries. “The semiconductor industry is a core national strategic sector that can determine the present and future of our economy. We must defend our leadership in the global supply chain,” President Moon said.
 
Korea is caught in the middle of the crossfire between the U.S. and China. If it can keep its tech competitiveness, it will be able to defend the leadership regardless of the changes in the global value chain. Companies are ready. The government must deliver its promise on full support. It must use its diplomatic power to defend Korea’s tech prowess in the U.S.-China conflict.
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