For the South Korean government its semiconductor industry has a strategic role, as well as those of OLED panel production or battery manufacturing. These three sectors have A very deep impact on its economyso it is understandable that the administration does everything in its hand to reinforce its position in the global market and increase its competitiveness.
In mid -December 2023 Yoon Suk Yeol, the former president of this Asian country, traveled to the Netherlands with the purpose of consolidating an alliance with ASML in matters of integrated circuits, among other priority objectives. During the last months South Korea has “faced” the US to protect the business of its main semiconductor manufacturers in China, among which are Samsung and SK Hynix. But his short -term perspective is discouraging.
Sales of semiconductors to China have fallen in February 31.8%
The Chinese market is essential for South Korea. It is at least if we stick to the integrated circuit industry. At the end of 2024 the country led by Xi Jinping represented approximately two fifths of all southern Korea technology exports, but the chips flow is plummeting. According to the Ministry of Commerce, Industry and Energy of this last nation in January 2025, the sale of chips contracted 22.5% compared to the same month of the previous year.
2025 is going to be a bad year for the semiconductor industry due to the cooling of global demand and the impact of tariffs
And in February the fall has been even more steep: 31.8% compared to February 2024. This trend supports the omens that predict for months that 2025 will be a bad year for the semiconductor industry due to the cooling of global demand and to the impact that presumably tariffs are already having in the integrated circuit industry. In any case, to South Korea this incipient crisis seems to be affecting more than other countries that also live largely from chips, such as Taiwan.
Samsung and SK Hynix lead the memory chips market, and much of their income comes from precisely these semiconductors. The US sanctions prevent them from selling their most advanced chips to their Chinese clients, which, precisely, are those that usually live with GPUs for artificial intelligence (AI).
China has responded by dedicating more resources to the development of its own memory technologies, which is causing A prices decrease which is clearly affecting the Samsung and SK Hynix business. In spite of all the consultant Gartner has predicted that the AI will pull the semiconductor industry for 2025, leaving the door ajar to the possibility that finally this year is not so bad for chip manufacturers as the first figures point out.
Image | Samsung
More information | SCMP
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