[Asia Economy Reporters Hyunwoo Lee and Hyunjin Jung] The domestic semiconductor industry is growing increasingly tense over the Biden administration's blatant "semiconductor hegemony" moves. The Biden government, recognizing that the semiconductor supply shortage that began with automotive parts could put advanced industries such as artificial intelligence (AI) at risk, is moving urgently, signaling the start of a new competitive regime in the global semiconductor industry.
According to CNN and other outlets on the 7th (local time), President Biden emphasized congressional cooperation in the infrastructure investment bill announced that day and stated that a bill related to the semiconductor chip shortage would soon be introduced in the U.S. Senate. He said, "A bipartisan group came to me 3 to 4 weeks ago about the computer chip issue," adding, "They said, 'We need to have our own supply chain. We need to cooperate,' and we are working on it. Senate Majority Leader Chuck Schumer and Senate Minority Leader Mitch McConnell are preparing to introduce a bill related to this." The bill is expected to include support measures to ensure a stable supply of semiconductor chips to the U.S. industry.
Such movements are occurring not only in the U.S. but also in China, Europe, Japan, and other parts of the world. The domestic industry is closely monitoring the changes and challenges that semiconductor self-reliance, led by governments in each country, will bring. Kim Yang-peng, a senior researcher at the Korea Institute for Industrial Economics and Trade, said, "The area the U.S. is currently focusing on is semiconductor foundries (contract manufacturing)," adding, "Competition could intensify in system semiconductors, and with Intel planning to enter foundry business, competition with Samsung Electronics may arise." System semiconductors such as central processing units (CPUs), graphics processing units (GPUs), and application processors (APs) used in AI, autonomous vehicles, and advanced weapons are directly linked to national security, and foundries are the places that produce these system semiconductors. The core of semiconductor self-reliance is securing production facilities domestically after discovering supply chain vulnerabilities due to COVID-19.
However, it is expected to take some time before noticeable changes occur in the semiconductor industry. An Gi-hyun, Executive Director of the Korea Semiconductor Industry Association, said, "There is currently a boom in manufacturing facilities. In a few years, this could lead to an oversupply of manufacturing facilities, so a supply and demand investigation should be conducted first," adding, "Considering that it takes more than three years to build manufacturing facilities even if decisions are made now."
Domestically, concerns are emerging that Korean companies, including Samsung Electronics, may face a crossroads amid the semiconductor hegemony competition between the U.S. and China. At the same time, some predict that since only Taiwan's TSMC and Samsung Electronics have advanced process foundry capabilities, the U.S. or Europe may offer economic incentives to attract their factories. Kim Young-woo, a researcher at SK Securities, said, "Considering the high technological barriers of advanced foundry processes, the possibility of new entrants is limited," and evaluated, "TSMC and Samsung Electronics are expected to see long-term improvements in foundry business profitability."
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