US-China 'Advanced Technology Cold War' Prolonged... "Expanding Cooperation with Europe, Canada, and Japan"

Korea Institute for Industrial Economics and Trade, Report on 'Industrial and Trade Strategies in the Era of Advanced Technology Cold War'
US Policy to Isolate China Continues Clearly and Strongly
China Responds with Domestic Supply Chain Localization and Expansion of Overseas Investment and Opening
Korea Needs to Expand Solidarity and Cooperation with Europe, Canada, Japan, etc.

[Asia Economy Reporter Moon Chaeseok] A national policy research institute has analyzed that South Korea needs to secure core technologies and expand cooperation with Europe, Canada, and Japan to prepare for the 'advanced technology Cold War era' between the United States and China. This is because the U.S.'s strong policy of isolating China and China's response are expected to continue for a long time.

On the 20th, the Korea Institute for Industrial Economics and Trade (KIET) stated this in its report titled "Industrial and Trade Strategies in the Advanced Technology Cold War Era."

◆ US Isolation of China and China's Dual Domestic and International Response... The Beginning of the 'Advanced Technology Cold War Era'

[Image source=AP Yonhap News]

KIET explained that the U.S. is employing a strategy to isolate Chinese companies in the digital communications sector by announcing the Clean Network program in the telecommunications field.

The U.S. has currently placed sanctions on Huawei and its 114 affiliates, as well as numerous telecommunications companies, scientific research institutes, and semiconductor manufacturers in China. Going forward, the U.S. is expected to accelerate China's isolation by urging allied countries to actively participate in the Clean Network program.

China is planning an industrial and trade strategy focused on the Greater China region to reduce its technological dependence on the U.S. Chinese President Xi Jinping is implementing the "Dual Circulation" strategy. This simultaneously emphasizes "internal circulation," which strengthens domestic technological capabilities and localizes supply chains, and "external circulation," which promotes globalization and integration through expanded investment and openness.

The Chinese State Council announced the promotion of the "Global Data Security Initiative," consisting of eight items, in response to the U.S.'s Clean Network. Although still at the conceptual stage, it plans to build international trust in independent data security and lead standards.

After disputes with the U.S., China is diversifying trade by engaging in economic and trade exchanges with the European Union (EU), Japan, South Korea, and countries participating in the Belt and Road Initiative. In particular, with Belt and Road countries, China is promoting the "Digital Silk Road" to expand standard cooperation in areas such as 5G and BeiDou, China's version of GPS satellite navigation system.

◆ US Demands South Korea Join China Isolation... China Pushes 'Korea Taming' in Security and Trade

[Image source=Reuters Yonhap News]

KIET expects that regardless of the outcome of the U.S. presidential election in November, the U.S. will clearly and strongly continue its China isolation policy. The U.S. has already started a war in the advanced technology sector and is strategically conducting it, and may impose additional sanctions on Chinese companies if necessary.

The U.S. is expected to demand more strongly that South Korea participate in China isolation policies such as the Clean Network, the Economic Prosperity Network, and decoupling from China in the Global Value Chain (GVC).

China is expected to use the fact that South Korea is its largest trading partner to separate South Korea from the U.S. cooperative system by pursuing a "Korea taming" policy with both hard and soft approaches in terms of security and trade on the Korean Peninsula.

For South Korea, there is a significant possibility of losing a considerable portion of China's demand for Korean products due to Chinese companies' independent technology development and increased U.S. sanctions. This increases uncertainty.

◆ "Develop Core Technologies for 6G and AI... Diversify Cooperation with EU, Canada, and Japan"

Samsung Electronics' mobile DRAM (3rd generation 10nm-class (1z) LPDDR5). (Photo by Samsung Electronics)

KIET diagnosed that to survive in this "advanced technology Cold War era," it is essential to secure core technologies, strengthen technological competitiveness, and build solidarity and cooperation with related countries.

In industries where South Korea holds competitive advantages, such as semiconductors and 5G, it is necessary to pursue a super-gap strategy.

In advanced technology fields such as 6G and artificial intelligence (AI), research and development (R&D) should be strengthened to develop core technologies and discover innovative technologies.

Senior Research Fellow Kim Dongsu of KIET urged, "In addition to the U.S. and China, it is necessary to diversify cooperative systems in the field of technological standards with Europe, Canada, and Japan to disperse risks."

This content was produced with the assistance of AI translation services.