South Korea is inching slowly towards the United States and Japan, which could put China on shaky ground, according to South China Morning Post.
(Photo : JUNG YEON-JE/AFP via Getty Images)
A signboard of Samsung Electronics is displayed outside the company's Seocho building in Seoul on January 31, 2023.
Last week, Yoon Suk-yeol, the South Korean President visits Japan for two days following the announcement to resolve its long-standing dispute with Tokyo due to wartime forced labor. This marks Yoon's first visit to the country in 12 years.
Yoon is also expected to convince Tokyo to drop export controls on chip-making materials to South Korea and align their positions on supply chains.
A Threat to China?
The reconciliation between the two countries could marginalize China in the production of advanced chips in global supply chains. When this happens, global semiconductor production will be more stable, considering that the industry is dominated by countries like Japan and South Korea, among others. Thus, it will isolate China.
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The Increased US Pressure on China
In addition, the ties between South Korea and Japan will highlight the increased pressure by the US on China's semiconductor industry. It can be recalled that in October 2022, Washington further restricts China's ability to acquire advanced chips.
In August 2022, US President Joe Biden also signed the CHIPS and Science Act to boost America's hi-tech manufacturing capabilities.
China is very aware of the importance of South Korea, as the two countries have strong business ties.
South Korea is a part of the Chip 4 Alliance, which is supported by the US government. This alliance also includes Japan and Taiwan and had its first meeting recently. Beijing has expressed disapproval of this alliance, claiming it is a plan devised by the US to shut out China from the semiconductor industry.
In January, the United States, Japan, and the Netherlands reportedly came to an agreement to limit the export of certain advanced chip-making machinery to China. Although specific details of the deal have yet to be made public, the Dutch government recently declared that measures to restrain semiconductor technology exports to China would be enforced prior to the summer.
Previous reports suggest that the US and South Korea have been discussing ways to strengthen their cooperation in semiconductor technology. The two countries are said to be exploring options such as joint research, development, and investment opportunities. This could help both sides advance chip-making capabilities while also allowing them to share information more easily.
According to CNBC, the US is reportedly looking for a way to counter China's dominance in the global semiconductor market by strengthening ties with its allies like South Korea who can provide access to advanced technologies needed for the production of chipsets used across industries ranging from automotive electronics, smartphones and other consumer devices.
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