[The Editors' Verdict]A Country the US President Must Return To

It is time to move beyond the memories of grand political events and soberly examine the significance and challenges of the Korea-US technological alliance. Let us end the debate over whether South Korea’s participation in the US-led semiconductor supply chain alliance is beneficial or detrimental. We have nothing to lose. At least in the semiconductor sector, that is true.

It was highly unusual for US President Joe Biden to visit South Korea before Japan and to start his visit by touring Samsung Electronics’ semiconductor factory. This symbolic scene shows that the US strategy to maintain hegemony has shifted to advanced technology retaliation in the trade sector. In this paradigm shift, South Korea’s cutting-edge semiconductor manufacturing capabilities become a key incentive for forming an alliance. Therefore, South Korea’s elevated status is valid only as long as it maintains its position as a manufacturing powerhouse. This is our first challenge. To protect security and interests, we must maintain or widen the technological gap. While this is possible through corporate leadership, improvements in laws and systems and government-led workforce development must also support it.

The formation of a semiconductor alliance between Korea and the US, including Japan and Taiwan, is a product of the US-China hegemony competition. Although concerns arise that our alliance participation might provoke China and put South Korea’s semiconductor industry at risk, such worries are largely unfounded. China, which purchases 40% of the semiconductors produced by South Korea, also desperately needs a smooth and sufficient semiconductor supply. The only way for our semiconductor industry to avoid exposure to Chinese retaliation is to maintain or widen the industrial competitiveness gap against China.

Semiconductor production processes have been thoroughly specialized based on market efficiency. The US designs, Dutch equipment and Japanese materials are used, South Korea and Taiwan manufacture, and Singapore conducts testing. This dispersed supply chain has raised concerns that geopolitical changes could threaten security. In response to moves within the alliance to secure stable supply, South Korea, which has no particular strengths outside manufacturing, has no reason not to participate. The US’s efforts to attract Samsung Electronics’ manufacturing facilities are also measures to compensate for its own weaknesses. Japan, the leader in materials, has partnered with manufacturing powerhouse Taiwan. Developing capabilities in core processes beyond manufacturing is our second challenge.

South Korea has also made efforts to nurture vulnerable areas such as design, materials, and equipment, but high entry barriers have kept progress stagnant. Semiconductor experts cite securing high-level talent as the top priority. President Yoon Suk-yeol’s numerous semiconductor pledges thus raise expectations. The key issue is how quickly laws related to strategic industries are enacted and educational regulations improved.

The third challenge is managing the threat from China, which requires meticulous and creative political and diplomatic skills from the government. ‘Balanced diplomacy’ is an inevitable choice. The monthly magazine “Monthly China,” published by China’s People’s Daily, advises that balancing does not mean keeping a moderate distance from both sides but rather gaining evenly from both. Many people, both in China and domestically, are closely watching the Yoon administration’s overly close alignment with the US. The stability of the semiconductor supply chain must not spread into crises over other critical materials, and this is the greatest challenge facing President Yoon.

A successful Korea-US summit does not guarantee our future and security indefinitely. US goodwill is not a matter of alliance etiquette or friendship. The US president will not return to a country without companies that have secured ultra-gap technological capabilities. It is clear what the priority tasks are for the government and companies to focus their capabilities on.

Shin Beom-su, Industry Managing Editor

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