'Vice Chairman Lee Jae-yong's Pardon' Passes the Baton to the New Government Along with 6G and Semiconductors (Comprehensive)

Until the Last Day of His Term, JY Pardoned with Eyes Closed by Moon
Passing the Baton to Yoon Government Aiming to Develop 6G and Semiconductors

[Asia Economy Reporter Park Sun-mi] With President Moon Jae-in not using the special pardon card until the last day of his term, Samsung Electronics Vice Chairman Lee Jae-yong will ultimately face the new administration under parole status. Since the 6G and semiconductor businesses, which Vice Chairman Lee has been diligently promoting, are included as key pillars in the Yoon Suk-yeol administration's 110 national agenda tasks, there is a prevailing sentiment that a path should be opened for Vice Chairman Lee to return to management, even if it is through a special pardon on Liberation Day this August.

According to the business community on the 9th, Vice Chairman Lee will attend the inauguration ceremony of the 20th president on the 10th under parole status, as a pardon or reinstatement did not materialize during President Moon's term. Although his sentence for the political scandal case expires on July 29, allowing him to be on parole, he will be able to attend the inauguration ceremony as the head of Samsung, the top-ranked company in the business world.

Not only Vice Chairman Lee but also business leaders such as SK Group Chairman Chey Tae-won, Hyundai Motor Group Chairman Chung Eui-sun, and LG Group Chairman Koo Kwang-mo will attend the inauguration ceremony and hold separate meetings with President-elect Yoon during the inauguration dinner. This is the first time in the history of government inaugurations that large conglomerate heads have been invited to the inauguration dinner. Since six heads of economic organizations, including Huh Chang-soo, Chairman of the Federation of Korean Industries, Sohn Kyung-shik, Chairman of the Korea Employers Federation, and Koo Ja-yeol, Chairman of the Korea International Trade Association, who have emphasized the need for pardons for businesspeople for the growth of the Korean economy, will also attend, it is expected that requests for pardons for businesspeople including Vice Chairman Lee will follow.

In the business community, there is also consideration that President-elect Yoon may use the presidential prerogative of pardon after taking office and reinstate Vice Chairman Lee through a 'Liberation Day special pardon' on August 15. Even if Vice Chairman Lee completes his sentence and is released at the end of July, he cannot engage in normal management activities due to a five-year employment restriction.

Since SK Group Chairman Chey Tae-won was also released through a Liberation Day special pardon in 2015, there is growing expectation that President-elect Yoon, who has pledged to create a favorable environment for businesses to operate, may lift Vice Chairman Lee's employment restrictions.

In fact, Samsung is regarded as holding the key to achieving the new government's goal of fostering new industries by identifying 6G and semiconductors as future growth engines. Samsung Electronics, which was the world's first to commercialize 5G, announced the '6G Frequency White Paper' for the first time yesterday and proposed global research to secure frequencies for next-generation 6G communication services.

Samsung Electronics released the '6G Frequency White Paper: Expansion of the Frequency Domain' on the Samsung Research website, proposing that discussions and related research on 6G frequencies should be conducted globally from now on to prepare for the long-term commercialization of 6G. They have taken a proactive approach based on the judgment that about 10 years are needed to commercialize candidate frequency bands for ultra-high-speed, large-capacity services such as holograms and XR (extended reality), according to the history of communication development.

Vice Chairman Lee, who has selected 5G as a future growth business and nurtured it, recently achieved a contract to supply 5G communication equipment worth 1 trillion won with a U.S. company and has been preparing to play a market-leading role by forming a 6G-related team for the past two years.

The semiconductor business also aligns with the goals of the new government and Samsung.

The Yoon administration has set securing a semiconductor super-gap and creating a new gap as one of its national agenda tasks to expand semiconductor exports by more than 30% by 2027, requiring bold semiconductor investments and mergers and acquisitions (M&A) by Samsung Electronics, the number one semiconductor company.

According to market research firm IC Insights, global semiconductor companies' research and development (R&D) expenditures totaled $71.4 billion last year, a 13% increase from the previous year. U.S. Intel spent the most at $15.2 billion, while Samsung's investment was about half that amount at $6.5 billion. An industry insider said, "If Vice Chairman Lee continues to face restrictions on management participation, Samsung's ability to make large-scale investment and M&A decisions will be limited." The insider added, "Since U.S. President Biden is likely to visit Korea on the 20th of this month and request semiconductor cooperation with the new government, the new administration will inevitably have to consider Vice Chairman Lee's situation."

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