KIEP Advises on South Korea’s Strategy in Semiconductor Sector

The Korea Institute for International Economic Policy (KIEP) said in its report on Aug. 8 that South Korea needs to strategically expand its presence in the U.S. semiconductor market by utilizing the United States’ semiconductor supply chain strategy and make more effect at the same time to further stabilize its own semiconductor supply chain.

“After having experienced supply chain failures attributable to COVID-19, the United States is internalizing supply chains in the key industries including semiconductor, in which its reliance on East Asia is still high,” the KIEP explained, adding, “This means new supply chain formation led by the United States will accelerate in those sectors.”

“Under the circumstances, South Korean semiconductor companies would be well advised to expand their business in the U.S. market by utilizing the formation as an opportunity and, at the same time, the South Korean government should reshape the domestic semiconductor supply chain with them so that its external dependence can be reduced,” it went on to say.

“Specifically, South Korea’s reliance on China in post-processing should be lowered and its collaboration with the United States, Japan and Europe should be expanded in weak parts such as lithography equipment,” it said, continuing, “Domestically, a new and inclusive research institute needs to be set up along with professional schools, not to mention plant construction-related deregulation.”




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