Samsung Electronics has reported a likely 96 percent plunge in second-quarter operating profit. (PHOTO: VCG)

Edited?by?GONG?Qian

Amid intensifying U.S.-China rivalry, Korea Chamber of Commerce and Industry Chairman Chey Tae-won has warned, "Losing the huge Chinese market would be irrecoverable for us." Other Korean businesses probably feel the same way.

Korean semiconductor manufacturers are particularly nervous. They were given just a one-year grace period under the U.S. CHIPS and Science Act designed to boost investment in American high-tech research and development and bring semiconductor manufacturing to the U.S. Samsung manufactures 40 percent of its NAND flash chips in China, while SK Hynix produces 40 percent of its DRAM and 20 percent of its NAND flash chips there. SK paid Intel 7 billion USD for a NAND flash plant in Dalian, China and could end up suffering losses if no more investment can be made.

U.S. manufacturers are also reeling. China accounts for a third of global semiconductor sales, while computer chips manufactured in the U.S. are ultimately assembled and tested in China. U.S. media reports are saying that Washington cannot afford to shut out Beijing because of the heavy dependence of the American semiconductor industry on China.

The Chinese economy is bigger than those of the G7 combined excluding the U.S., which is why the EU for instance does not always toe U.S.' line when it comes to China. The role of the Korean government, too, is to find a wise balance between maintaining its principles and ensuring flexibility at the same time in dealing with China.

Editorial, The Chosun Ilbo, 14-07-2023.