South Korea and Japan Strengthen Their Domestic Semiconductor Industries Amid Global Tensions

Jakarta, INTI - Amid growing geopolitical tensions, particularly in the trade relations between the United States and China, countries in Asia, such as South Korea and Japan, are increasingly strengthening their domestic semiconductor industries to ensure resilience in the global chip supply chain. Semiconductors have become a strategic commodity due to their crucial role in modern technology, ranging from consumer electronics to advanced military systems.

The growing dependency on semiconductors has prompted countries in Asia, which have long relied on other nations for chip production, to find ways to reduce that dependence and boost their domestic capacities. A prime example of this shift is the efforts being made by South Korea and Japan to strengthen their semiconductor industries.

South Korea's Efforts to Strengthen Its Semiconductor Industry

South Korea, home to semiconductor giants like Samsung Electronics and SK Hynix, is increasingly ramping up policies to support its semiconductor industry. The ruling party in South Korea has recently proposed a special chips act, aimed at providing subsidies and exemptions from work-hour restrictions for semiconductor companies. This move is in response to the tariff threats imposed by President Donald Trump on Chinese-made goods, which could potentially affect South Korean companies.

Furthermore, South Korea plans to allocate even more funding for research and development in the semiconductor sector, hoping to compete with other major countries like China, Taiwan, and the United States, which are also heavily supporting their domestic chip manufacturers.

Japan's Ambitious Plans to Support Semiconductors

Meanwhile, Japan has also made significant moves to strengthen its semiconductor industry. Recently, the country announced a 10 trillion yen (US$65 billion) plan to support semiconductor and artificial intelligence (AI) projects. This plan indicates Japan's commitment not only to increase its domestic semiconductor production capacity but also to become a leader in AI technologies, which will drive the future of the semiconductor industry.

However, despite the large-scale investment plans, Japan has stated that it will not increase taxes to finance these projects. This suggests that Japan aims to support the technology sector without burdening its citizens with higher taxes.

The Impact of President Trump’s Policies on Global Semiconductor Dynamics

The actions taken by South Korea and Japan are also driven by the worsening international trade tensions. Under President Donald Trump, the United States has proposed several policies that could disrupt the global semiconductor supply chain. One such policy is the imposition of tariffs that could harm countries dependent on semiconductor imports from China. Countries like Taiwan, home to major semiconductor companies such as TSMC, now face tariff threats that could affect global chip supplies.

The steps taken by South Korea and Japan to strengthen their domestic semiconductor industries reflect long-term strategies to protect themselves from the ongoing geopolitical tensions. With semiconductors as a critical commodity in the digital world, these countries are working to secure their chip supplies while strengthening their positions in the global semiconductor industry.