"US Presidential Election Outcome Regardless, AI Semiconductor Hegemony Competition Intensifies"

KCCI, Korea-US Industrial Cooperation Conference
"Batteries Must Prepare for Reduced IRA Benefits"

Regardless of the outcome of the U.S. presidential election, it is expected that the power struggle between the United States and China over semiconductors will intensify. In the battery sector, there is advice to prepare for potential impacts on Korean companies as the benefits of the U.S. Inflation Reduction Act (IRA) may be reduced.

At the 'Korea-U.S. Industrial Cooperation Conference' jointly hosted by the Korea Chamber of Commerce and Industry and the Korea-U.S. Association on the 23rd at the Korea Chamber of Commerce and Industry building in Jung-gu, Seoul, experts emphasized that "regardless of the U.S. presidential election results, the U.S.'s stance on containing China and expanding domestic investment will continue," highlighting the need for strategic responses from the Korean industry.

Professor Kwon Seok-jun of Sungkyunkwan University stated, "No matter who wins, the U.S.-China power competition will escalate beyond semiconductors into advanced technology fields such as artificial intelligence (AI) and quantum computing," adding, "Especially in the AI semiconductor sector, the competition may evolve into a confrontation not only between countries but also between the Nvidia alliance and a U.S. IT and advanced technology company-centered anti-Nvidia alliance, making strategic judgment by domestic companies crucial."

Professor Kwon explained that there are differences in semiconductor policies between the two major parties. He said, "The Democratic Party pursues semiconductor hegemony centered on clusters with allied countries, while the Republican Party prefers a domestic-centered approach." He added, "If the Democrats win, they are likely to form 'COCOM 2.0,' an advanced technology export control organization with allied countries to pressure China, and strengthen domestic investment incentives through amendments to the Chips Act." COCOM is an export control organization established in 1949 centered on the United States.

It is expected that if the Republicans come to power, they will seek to maintain semiconductor and AI technology superiority by expanding domestic investment and tightening investment requirements for allied countries.

Regarding Korea's response, he said, "It is important to establish Korea as an indispensable core partner of the U.S. by developing high-performance AI-dedicated memory chips, securing leading-edge technologies, and setting standards and roadmaps," adding, "To this end, expanding the domestic mega cluster ecosystem and making mid- to long-term R&D and human resource investments in next-generation technologies are necessary."

Gary Clyde Hufbauer, Senior Fellow at the Peterson Institute for International Economics, said, "Regardless of who wins the U.S. presidential election, the Chips Act, which has contributed to semiconductor investment, will be maintained," and added, "If Trump wins, he is more likely to expand subsidies than Vice President Harris, who focuses on social welfare spending."

He continued, "During the next presidential term, AI will be the main focus of the semiconductor industry," and predicted, "High-performance semiconductors and talent acquisition are essential, and if Trump wins, policies to thoroughly block these two from China will be strongly pursued."

Ahn Ki-hyun, Executive Director of the Korea Semiconductor Industry Association, said, "Regardless of the election outcome, it will become difficult to import advanced semiconductor equipment into China," and added, "If Trump wins, semiconductor investment support may be centered on domestic companies, so monitoring and proactive responses are necessary to prevent damage to domestic companies." He also emphasized, "To secure global competitiveness, the domestic semiconductor industry needs direct subsidy support like other major countries."

Professor Shin Chang-hwan of Korea University’s Department of Semiconductor Engineering said, "Regardless of who wins, the U.S. will strengthen alliances with allied countries such as Korea, Taiwan, Japan, and the Netherlands to develop ultra-advanced semiconductors," and noted, "There is also a possibility of an unexpected reconciliation scenario with China in certain fields."

Concerns were raised about the reduction of IRA benefits in the battery sector. Lucas Bednarski, author of 'Battery Wars,' who gave a keynote presentation via video conference, explained, "About 125 projects across the supply chain, including lithium mines and battery factories, have been launched in the two years since the IRA was implemented, with investment amounts reaching $95 billion (approximately 128 trillion KRW)."

He suggested, "The Korean battery industry can utilize lithium mined by U.S. companies," and recommended, "Joint R&D between companies and universities of both countries and linking Korean battery-related startups with U.S. venture capital are also necessary."

Hwang Kyung-in, Associate Research Fellow at the Korea Institute for Industrial Economics and Trade, said, "Even if Trump wins, considering the Republican support in the U.S. IRA beneficiary regions, repealing the law will not be easy," but added, "If IRA rollback through administrative authority becomes a reality, domestic companies’ investments in the U.S. may be readjusted." He continued, "Regardless of who wins, the policy of decoupling the battery supply chain from China will continue, so internalization of battery raw materials and materials and diversification of procurement sources are necessary."

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