KCCI Discusses Global Supply Chain Response Strategies for Secondary Batteries, Semiconductors, and More
[Asia Economy Reporter Hwang Yoon-joo] If global supply chain uncertainties persist due to US-China competition, strategic industries such as domestic secondary batteries and semiconductors are also expected to be affected. In response, the secondary battery industry is addressing supply risks such as securing raw materials centered on material companies, while the semiconductor industry is advised to diversify supply chains concentrated in specific countries.
The Korea Chamber of Commerce and Industry held an online seminar on the 7th titled "Global Supply Chain Response Measures to China's Export Controls." It was organized as a response to the expansion of supply chain instability issues caused by prolonged COVID-19, the China-origin urea solution crisis, and the emergence of the Omicron variant.
At the seminar, companies urgently reviewed the situation to ensure that the supply chains of key materials and components are not disrupted by the resurgence of COVID-19, and in-depth discussions were held on establishing joint public-private countermeasures to prepare for continuous supply chain shocks.
Lee Jun, Director of Industrial Policy Research at the Korea Institute for Industrial Economics and Trade, stated, "Issues such as the US-China technological hegemony competition and carbon neutrality may amplify global supply chain uncertainties that could persist for a long time," adding, "especially, Korea has a structure that could be most affected by changes in the China-centered global supply chain system due to its very close industrial division of labor with China, so a considerable level of response capability will be required going forward."
Secondary Batteries: "Strengthening Environmental Issues Centered on the EU"... Need to Advance Demand Forecasting Centered on Material Companies
There was also a keynote presentation on the secondary battery industry, which has been elevated to a national strategic industry. Kim Min-ji, a senior researcher at the Materials Industry Office of the Korea Institute for Industrial Economics and Trade, in her presentation titled "Global Supply Chain Issues and Response Measures in the Secondary Battery Industry," said, "the secondary battery industry has a very high dependence on China in the raw material sector, making it sensitive to changes in China's environmental regulations and energy supply and demand," emphasizing "the need to establish a cooperative foundation among companies to strengthen the stability of the raw material supply chain and explore response measures."
She continued, "Specifically, it is urgent to strengthen collaboration with raw material companies, secure resource recovery technologies related to used batteries, and build an industrial ecosystem," and expressed the opinion that "discussions on system advancement related to supply risks and demand forecasting centered on material companies are necessary."
Semiconductors: "Facing a New Era of Global Value Chain Transformation in the Domestic Semiconductor Industry Due to US Semiconductor Leadership Strengthening and US-China Decoupling Policies"
Jung Hyung-gon, senior researcher at the World Regional Research Center of the Korea Institute for International Economic Policy, pointed out, "The strengthening of US semiconductor leadership and US-China decoupling policies are the biggest variables in the global supply chain structure of the semiconductor industry."
He observed, "The US will restructure the supply chain by controlling China through semiconductor technological hegemony and inducing the de-Chinaization of semiconductor companies that have invested in China in the long term. While meeting the semiconductor demand of multinational corporations and Chinese companies operating in China, the domestic semiconductor industry will grow, and depending on the direction of the US semiconductor control policy in the future, the domestic semiconductor industry will be significantly affected."
He further analyzed, "Companies need to plan the current supply chain restructuring to diversify supply chains concentrated in specific countries, and the government urgently needs to establish a comprehensive semiconductor research institute, expand R&D personnel, along with the K-semiconductor development strategy."
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