Among US-China-Japan Trade, 75.5% of Key Imported Parts Are Made in China... "Urgent Need to Resolve Concentration"

[Image source=Yonhap News]

[Asia Economy Reporter Kim Jin-ho] Most of the key import items that South Korea needs to manage intensively were found to be of Chinese origin. Given the prolonged Ukraine war and the global supply chain disruptions caused by the Shanghai lockdown in China, concerns have been raised about the need to resolve the overreliance on China.

The Federation of Korean Industries (FKI) released a report titled "Status and Implications of Key Industrial Materials in the Korean Economy" on the 30th, commissioned to Professor Choi Nam-seok of the Department of Trade at Jeonbuk National University.

The report identified 228 items as "key import items requiring management," which are items with an import dependency rate of over 90%, absolute inferiority in import competitiveness, and belonging to the top 30% in terms of import value. Among these 228 items, 172 (75.5%) were Chinese products. Japanese products accounted for 32 items (14.0%), and American products accounted for 24 items (10.5%).

The key Chinese import items requiring management include industrial raw materials such as electrical products, machinery and computers, steel, organic and inorganic compounds, glass, medical supplies, and non-ferrous metals. Notably, manganese, an essential material for steel manufacturing; graphite, a critical raw material used in the anode of electric vehicle batteries; and magnesium, a major material for automotive lightweighting, are representative Chinese import items.

Key Japanese import items include electrical products, machinery and computers, plastics, and organic compounds for electrical products. Items requiring management among Japanese imports include polyimide film, a material for foldable displays, and machinery or injectors used for processing semiconductor wafers. Key American import items include petroleum and coal, aircraft, electrical products, fruits, and machinery and computers.

Professor Choi advised, "If supply and demand management for key import items is not properly handled, supply crises like the urea solution shortage can occur at any time." He recommended establishing a continuous monitoring system for the 228 items and taking measures such as diversifying import sources.

In particular, Professor Choi pointed out that an early warning management system should be established for 133 items judged to have frequent inter-company transactions and vulnerable global supply chain safety. He also emphasized that the government’s response measures should be continuously adjusted in a customized manner based on the on-site demand of domestic private companies. Representative Chinese import items requiring an early warning system include tungsten oxide (a semiconductor material), calcium chloride, video cards, solar modules, and pesticide raw materials.

Yoo Hwan-ik, head of the FKI Industry Division, stated, "The prolonged Russia-Ukraine conflict and Shanghai lockdown measures are worsening the global supply chain crisis," and stressed, "The overreliance on China must be resolved through diversifying import sources and actively participating in global supply chain alliances."

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