"South Korean Semiconductor at a 'Strategic Inflection Point'... How to Seize Leadership Amid US-China Tightrope"

Joint Academic Conference of Five Major Societies Including the Korean Academic Society of Business Administration
Acceleration of Global Supply Chain Restructuring Amid US-China Hegemony Competition
Professor Jeong Yeonseung: "Strong National Industrial Policy Needed"

"The era has come when the semiconductor industry cannot be left solely to market logic. It is a crucial time for the government to play a role in strengthening our position amid the global supply chain restructuring." (Jeong Yeonseung, Professor, Department of Business Administration, Dankook University)

"It is becoming increasingly difficult for companies to manage investment risks on their own. The government must actively introduce and review subsidy policies going forward." (Choi Wooseok, Director of Industrial Policy, Ministry of Trade, Industry and Energy)

"When the executive system is divided into technology, industry, diplomacy, and education, conflicts of interest may arise due to differences in roles. Governance must be integrated to establish a control tower." (Ahn Gihyun, Executive Director, Korea Semiconductor Industry Association)

As the US-China hegemonic competition intensifies, concerns about the domestic semiconductor industry are growing. The global supply chain, which was based on a division of labor, is collapsing, and with the rise of nationalism, it is pointed out that it is difficult to maintain global semiconductor competitiveness with the existing framework. It is described as a 'strategic inflection point' where efforts are being made at the national level to prepare various alternatives.

Professor Jeong Yeonseung of Dankook University is delivering a presentation on the 15th at the joint academic conference of five major societies held at the Korea Chamber of Commerce and Industry International Conference Hall. / Photo by Kim Pyeonghwa

Amid Supply Chain Restructuring, US-China Tightrope Walk Intensifies... "Strong Industrial Policies and New Success Models Needed"

The five major academic societies?the Korean Academy of Management, Korean Economic Association, Korean Sociological Association, Korean Political Science Association, Korean Association for Public Administration, and the National Research Council for Economics, Humanities and Social Sciences?held a joint academic conference on the morning of the 15th at the Korea Chamber of Commerce and Industry International Conference Hall in Jung-gu, Seoul, under the theme "Challenges and Prospects of Korean Society in 2023: An Era of Transition, Crisis, Challenge, and New Leap."

At the event, a session was held to discuss response measures and policy directions that the Korean semiconductor industry should take amid the restructuring of the global supply chain. Professor Jeong, who gave a related presentation, stated, "The US-China hegemonic competition flow is having the greatest impact on the global supply chain," adding, "Since advanced countries like the US and China are strongly intervening in the market under government leadership, we cannot afford not to intervene." He emphasized the importance of the national role.

Korea has grown its semiconductor industry by building an efficient division of labor within the global supply chain. It expanded its business by increasing intermediate goods division with China and pursued different strategies in the US by growing the foundry (semiconductor contract manufacturing) business and establishing technology and R&D centers. Now, the situation is leaning toward having to choose one or the other. This is why Professor Jeong expressed concern that "strengthening business in China could now become a liability."

He pointed out that in the precarious tightrope walk of Korean semiconductors, it is essential to seize global leadership through strong government-led industrial policies and generous support. He also advised increasing investment and overseas cooperation to lead future core technologies. Additionally, attracting foreign companies to invest domestically is necessary.

From the left, Professor Lee Jung-hyun of Myongji University (Senior Vice President of the Korean Academic Society of Business Administration), Professor Jung Yeon-seung of Dankook University, Choi Woo-seok, Director of Industrial Policy at the Ministry of Trade, Industry and Energy, Ahn Ki-hyun, Executive Director of the Korea Semiconductor Industry Association, and Professor Kim Yeon-sung of Inha University (Next President of the Korean Academic Society of Business Administration) are conducting a discussion and Q&A session. / Photo by Kim Pyeong-hwa

Another presenter, Director Choi, also emphasized the need to maintain a technological super-gap. While large-scale investment is essential in advanced industries, given the high corporate risks, he stressed that the government must promote various investment and subsidy policies. He also explained that the government is considering specialized universities for advanced industries, support for corporate in-house universities, and measures to attract overseas talent to secure technological competitiveness.

During the discussion, advice was given that a new success model must be found amid the global supply chain restructuring. Ahn Gihyun, Executive Director of the Korea Semiconductor Industry Association, said, "Our country is a manufacturing powerhouse that developed industrial technology from the technology developed by pioneering countries," adding, "Now that technology, industry, market, and nation are integrated, new research is needed." He also called for governance integration and "a system that industrializes school-based fundamental technology research."

Kim Yeonseong, Professor of Business Administration at Inha University and the next president of the Korean Academy of Management, also noted that Korea "has reached a strategic inflection point where it is difficult to grow by past methods and new approaches are needed." He continued, "New corporate strategies, new government policies, and academic efforts to support these are necessary," urging industry-academia-government cooperation and joint responses.

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