"The US will have a bite of the Chinese market, which once belonged to South Korea, if Seoul yields to Washington's pressuring," Wang Peng, a research fellow at the Beijing Academy of Social Sciences said. "Even if South Korea joins the US alliance, it will not be able to obtain any newer technology from the US, but will only be regarded as a tool to contain China," Ma said. "Japan has a number of high-tech products, but no complete industry chain due to the US' activities," he noted. The biggest loss of Japan's chip industry was not earnings, but the opportunity to build a complete advanced industry chain, Ma said. "Oppressing one country while supporting another is a typical practice of the US," Ma said. The US then imposed several rounds of extra tariffs on Japanese products, while giving South Korea preferences to develop its semiconductor industry. Japan's semiconductor industry saw rapid development both in terms of design and manufacturing two decades ago, becoming a "threat" to the US' chip sector. Upholding the idea of "America first," the US will definitely be the biggest beneficiary of such an alliance, while Japan and South Korea will be the victims, Ma said, citing precedents in history. But four months later, South Korea has not yet given a clear answer.Īccording to South Korean media, without negotiations and coordination in advance, the US unilaterally informed South Korea that it is scheduled to hold a meeting on the issue at the end of August.Īdding to the pressure, US Treasury Secretary Janet Yellen showed up in Seoul on Tuesday, claiming to end the US' "undue dependence" on rare earths, solar panels and other key goods from China, according to Reuters. In March, the US proposed the idea of "Chip 4" and sent invitations to Japan, South Korea and China's Taiwan island. Workers make semiconductors at a company in Guiyang, Southwest China's Guizhou Province. "South Korea's and China's chip industries have become intertwined in the past 20 years, and it is almost impossible to separate the two bluntly," Ma said. Samsung's first-quarter fiscal report for 2022 showed the company's net revenue in China amounted to 10.46 trillion won ($7.98 billion), 13 percent of the total. The NAND flash memory chips made by Samsung Electronics' Xi'an factory account for more than 40 percent of its NAND flash memory output, while 45 percent of SK Hynix's total DRAM chip output is produced in Wuxi, East China's Jiangsu Province, according to South Korean media outlets. SK Hynix announced in May plans to build a new wafer manufacturing base in Dalian, Northeast China's Liaoning Province, further expanding its business in China after acquiring US chip giant Intel's assets in the region. Ma said that South Korea is in the upstream in most fields, but now, some South Korean chip companies have a large number of manufacturers in China for production as well as research and development, and the chips used by some South Korean companies are also made in China. South Korea's chip trade with other countries is about $150 billion per year, and chip trade with China accounts for around 30 percent.Ĭooperation between China and South Korea in the field of chips is very close, and they are almost "inseparable," Ma Jihua, a veteran technology analyst, told the Global Times on Friday. If South Korea blindly follows the US, its chip exports will suffer a huge blow, harming its $40- $50 billion chip trade per year with China, Han Xiaomin, general manager of Jiwei Insights in Beijing, told the Global Times on Friday. Yoon's prudence on the topic indicated South Korea's careful calculations over gains, if any, against losses from possible participation, as South Korea's export-centered economy would be hit hard if it blindly joins the US' technology choking-off of China, South Korea's largest trading partner, observers said. South Korea faces a dilemma of whether to join the US-led semiconductor alliance "Chip 4" or not, as President Yoon Suk-yeol has called for "active diplomacy" with China to ensure there are no misunderstandings regarding its possible participation, the Yonhap News Agency reported.
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