Recently, the United States has tightened restrictions on China's semiconductor industry, with the intention of reducing China's influence in the global semiconductor industry chain. The United States** has not only mobilized its so-called "allies" to participate in this action, but South Korea was the first country to be affected. This U.S. policy could force South Korea's semiconductor industry to face significant challenges.
According to a report by South Korea's "East Asia", the United States plans to investigate the purchase of traditional Chinese semiconductor products by American companies in order to reduce dependence on Chinese products and reduce the so-called "** risk". U.S. restrictions target chips of 28 nanometers and above, which are widely used in automobiles, home appliances and consumer electronics.
This U.S. strategy is aimed at driving the withdrawal of relevant industries from China and disrupting China's industrial chain. While China has a large domestic market and Asian, African, and Latin American markets as an alternative, South Korean and Japanese companies are struggling as a result. South Korea's semiconductor industry is highly dependent on the Chinese market, and the U.S. action could have a serious impact on South Korea's home appliances, smartphones, automobiles, and memory chip industries such as Samsung and Hynix.
Ironically, as South Korea considers how to respond to U.S. demands, there has been a historic reversal between China and South Korea. For the first time in 31 years, South Korea has had a deficit since the establishment of diplomatic relations in 1992, with South Korea exporting $114 billion to China and importing $132 billion from China. This change has raised concerns in the South Korean industry, as South Korea, as an export-oriented country, needs to consider how to maintain its best relationship with China.
For a long time, South Korea's economy and industry have relied heavily on the Chinese market. China's modernization and rejuvenation have provided opportunities for South Korea's development. However, South Korea frequently follows the United States in international affairs and bilateral relations, which could hurt cooperation between China and South Korea.
China's industries are undergoing transformation and upgrading, overlapping with major industries in Japan and South Korea. If Japan and South Korea can clearly understand the situation and promote friendly relations with China, there may still be room for cooperation. But if they continue to unconditionally support U.S. policies, then they may lose their foothold in the Chinese market. The deficit between China and South Korea may be just the beginning of China's industrial upgrading, and South Korea may face more challenges in the future.