"Intensifying US-China Tech Hegemony Competition... Korean Companies Urgently Need Independent Technology"

5th KCCI Next Trend Lecture

Yeon Won-ho, Deputy Research Fellow at the Korea Institute for International Economic Policy, giving a lecture on the theme of "US-China Technological Hegemony Competition and the Future of Our Companies" at the 5th KCCI Next Trend Online Lecture on the 18th.

[Asia Economy Reporter Dongwoo Lee] The Korea Chamber of Commerce and Industry announced on the 18th that it held an online lecture titled "Next Trend of the Korea Chamber of Commerce and Industry," inviting Yeon Won-ho, Deputy Research Fellow at the Korea Institute for International Economic Policy, on the theme of "US-China Technological Hegemony Competition and the Future of Our Companies."

Deputy Research Fellow Yeon Won-ho diagnosed that if the technological hegemony competition between the US and China prolongs, the reason is "the Biden administration recognizes China's unfairness, and China is responding strongly to US sanctions," adding, "As bipartisan anti-China sentiment spreads within the US, all US sanction measures are being legislated, institutionalizing the conflict."

Deputy Research Fellow Yeon forecasted, "The newly launched Biden administration prioritizes the revival of US manufacturing and trade negotiation strategies emphasizing labor and environmental policies, which are considered China's weaknesses, and it is aware of China's unfair practices, so significant changes in the US-China conflict structure are unlikely."

He further diagnosed, "China is preparing for a long-term confrontation with the US not through an 'eye for an eye, tooth for a tooth' strategy against US sanctions but through the 'New Long March Strategy,' represented by the China version of the New Deal, Yangxin Yizhong, and the dual circulation development based on the virtuous cycle of the domestic economy."

Deputy Research Fellow Yeon stated, "The 2018 US National Defense Strategy report, the 2018 USTR Section 301 investigation report, and the 'China Strategy Report' announced by the White House in May this year all show that the fundamental cause of the US-China dispute stems from the hegemonic competition over advanced technology."

He said, "Unlike in the past, advanced technologies representing the 4th Industrial Revolution, such as 5th Generation Mobile Communications (5G), Artificial Intelligence (AI), robotics, and quantum computers, have dual-use characteristics that increase both economic and military power as investments increase, which is why the US is heightening its vigilance against China's technological rise."

Deputy Research Fellow Yeon analyzed that in the technological hegemony battlefield, the US holds qualitative superiority, while China holds quantitative superiority. He explained, "China's research and development (R&D) investment scale is nearly close to that of the US, and the number of international patent applications surpassed the US last year, but in terms of intellectual property rights indicating possession of core source technologies, the US is far ahead of China by a significant margin."

He added, "This is evidence that China is strong in innovation but still weak in invention patents that create source and core technologies," and mentioned, "The US's China sanction measures such as the Export Control Reform Act (ECRA) and the Foreign Investment Risk Review Modernization Act (FIRRMA) are linked to these points."

He emphasized, "Through the implementation of the US 'Foreign Investment Risk Review Modernization Act' (FIRRMA), even non-controlling foreign investments in businesses related to core technologies, critical infrastructure, and sensitive personal information are subject to review," adding, "This is seen as a measure to strongly regulate Chinese technological investments in the US."

Deputy Research Fellow Yeon said, "Korean companies caught between the whales of the US and China may find themselves isolated, unable to side with either," and added, "Since it is difficult to expect any windfall benefits from US sanctions against China or China's sanctions against the US, our companies must now strive to strengthen their independent technological capabilities."

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