[2022 National Audit] Jeong Uncheon "Dependence on Chinese Semiconductor Raw Materials Increasing Every Year for 5 Years"

Reduce Dependence on Japan, Increase Dependence on China
"Domesticize SoBuJang Technology to Enhance Self-Reliance"

Jeong Un-cheon, member of the People Power Party. [Photo by Jeong Un-cheon]

[Asia Economy Reporter Han Yeju] Over the past five years, dependence on China for major semiconductor raw materials has significantly increased.

According to data received by Assemblyman Jeong Uncheon (People Power Party) of the National Assembly's Industry, Trade, Energy, Small and Medium Enterprises Committee from the Ministry of Trade, Industry and Energy, both the import value from China and the share of total imports of five major semiconductor raw materials (silicon wafers, hydrogen fluoride, neon, krypton, xenon) have increased from 2018 to July of this year.

Looking at the figures by year, the total import value (in USD) of the five semiconductor raw materials was ▲$1.81075 billion in 2018 ▲$1.88156 billion in 2019 ▲$1.69110 billion in 2020 ▲$1.94479 billion in 2021 ▲$1.55017 billion from January to July 2022, showing slight fluctuations each year.

On the other hand, during the same period, imports from China for these five items surged by 170%. ▲$139.81 million in 2018 ▲$167.39 million in 2019 ▲$140.86 million in 2020 ▲$184.79 million in 2021 gradually increased each year, reaching ▲$377.97 million from January to July 2022.

Not only the import value but also the share of total imports from China grew. The proportion of imports from China among the total import value of the five items was ▲7.7% in 2018 ▲8.9% in 2019 ▲8.3% in 2020 ▲9.5% in 2021 ▲24.4% from January to July 2022, nearly tripling in five years.

Examining by raw material, for silicon wafers, although the total import value decreased, imports from China approximately doubled, and the share of China in total imports also increased annually from ▲3% in 2018 ▲6% in 2019 ▲5% in 2020 ▲6% in 2021 ▲to 10% in July 2022.

For hydrogen fluoride, total imports continuously declined along with imports from China, but the share of imports from China was ▲52% in 2018 ▲51% in 2019 ▲75% in 2020 ▲70% in 2021 ▲78% in July 2022, which increased as imports from Japan sharply decreased.

Rare gases essential for semiconductors such as neon, krypton, and xenon showed even higher dependence on China compared to other items. The import value of neon from China increased 100-fold over five years, and its share of total imports grew from 18% to 84% during the same period. Krypton's import value from China increased 300-fold in five years, with its share rising from 13% to 31%. Xenon's import value also increased about 30 times, with its share rising from 5% to 37%.

Assemblyman Jeong Uncheon pointed out, "As the previous government reduced dependence on Japan for semiconductor raw material imports, dependence on China appears to have increased accordingly. Especially amid escalating US-China tensions, if the semiconductor supply chain becomes concentrated in China, a 'second diesel exhaust fluid crisis' could occur at any time."

He added, "The government must continuously strive to diversify import sources to resolve semiconductor supply chain risks and ultimately actively invest in domesticizing materials, parts, and equipment technologies to increase self-reliance."