“Samsung and SK Hynix in trouble with factories in China… Worst situation in Korea”
US Commerce Secretary “Micron sanctions are economic coercion… I will not tolerate”
Bloomberg reported on the 28th (local time) that the Korean government sees China’s sanctions against the US semiconductor company Micron as an attempt by China to divert relations between South Korea and the US and is unlikely to take advantage of it.
Bloomberg, citing a source familiar with the matter, said that the Korean government would not encourage Samsung and SK Hynix to increase their market share in China by taking advantage of Micron’s vacancy.
The source told Bloomberg that South Korea regards the United States as a key long-term partner for the Korean semiconductor industry and is wary of taking advantage of the Micron situation because it does not want to undermine that relationship.
Recently, in the U.S. Congress, it was openly argued that Korean companies should not fill the vacancy at Micron, which was subject to sanctions by China. On the 23rd, Mike Gallagher, chairman of the House US-China Strategic Competition Committee, said in a statement, “South Korea, an ally that has directly experienced China’s economic coercion in recent years, must also act to block (Micron’s) filling the void.”
It is unprecedented for the United States to openly pressure even individual companies of its allies to join the popular front.
The U.S. government also emphasized its position several times that it would “cooperate with key allies and partners to closely coordinate responses to distortions in the memory semiconductor market caused by China’s actions.” South Korea is the only country that is an ally of the US and produces and sells memory semiconductors in China.
South Korean semiconductor companies find themselves in an increasingly embarrassing position.
Samsung and SK Hynix have factories in China, which is their biggest market. However, it is difficult for them to turn a blind eye to the demands of the United States, as there are issues that require urgent consultation with the United States, such as whether to extend the export control of semiconductor equipment to China in October or the easing of subsidy requirements under the Semiconductor Act.
“China’s sanctions on Micron will put Korea in the worst situation of both camps (US and China),” said Troy Stangeron, senior director at the Korea-US Economic Research Institute in Washington, USA. He told Bloomberg that if Micron does not help fill the vacuum, China could penalize South Korea in the same way it did in retaliation for the Terminal High Altitude Area Defense (THAAD) system.
Meanwhile, U.S. Commerce Secretary Gina Lamondo said at a press conference after the Indo-Pacific Economic Framework (IPEF) ministerial meeting held in Detroit on the 27th (local time) regarding China’s sanctions on Micron, “We clearly see it as economic coercion.” “We won’t accept that, and we don’t think it will work,” he said. “We are working closely with our partners to address this challenge and any challenges related to non-market practices in China,” he said.
2023-05-28 12:01:00
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