Escalation of US-China Competition and the Semiconductor-Centric Tech War As the technological hegemony competition between the US and China intensifies, the global semiconductor industry is experiencing unprecedented changes at its core. With the emergence of a concrete 'tech war,' global supply chains related to advanced technology sectors are being reorganized, directly impacting South Korea, which has established itself as a global hub for semiconductor production. The recent competition between the US and China extends beyond mere technological development speed, significantly influencing the global economy and corporate strategies. So, what does this phenomenon mean for the South Korean semiconductor industry, and how should we respond? The technological hegemony competition between the US and China is not a short-term phenomenon. Semiconductors, in particular, are considered a key battleground in today's tech rivalry. The United States is implementing stringent regulations to restrict the export of advanced semiconductors to China, aiming to maintain its technological superiority. US semiconductor export controls, first announced in October 2022, have been continuously strengthened throughout 2023 and 2024. By late 2025, additional sanctions on AI semiconductors were announced, creating even greater barriers for China to access high-performance semiconductors and advanced artificial intelligence (AI)-based technologies. According to a December 2025 analysis by The Economist, these regulations led to a 37% decrease in China's advanced semiconductor imports compared to 2024, with nearly all chips using processes below 7 nanometers being blocked. Conversely, China is making massive investments with the goal of increasing its domestic semiconductor production share to 70% by 2030 to boost self-sufficiency. In 2025 alone, the Chinese government invested approximately $143 billion in its semiconductor industry, a 28% increase from the previous year. Will Knight, a senior editor at MIT Technology Review, analyzed, "China's efforts toward semiconductor self-reliance have become a strategic national security imperative, transcending mere economic goals." He added, "Although a technological gap still exists, China's pace of catching up is faster than anticipated." Amidst these developments, South Korea, as a global powerhouse in semiconductor manufacturing, faces complex diplomatic and economic challenges. Global supply chain shifts have also emerged as a major issue. Leading global semiconductor manufacturers are exploring diversification strategies to mitigate risks, moving away from existing production structures concentrated in specific regions such as the US, China, Europe, and Taiwan. This is referred to as 'decoupling' or 'de-risking' strategies. According to a January 2025 geopolitical risk report by S&P Global, such supply chain diversification is likely to lead to increased costs and reduced efficiency in the short term. The report estimates that additional costs due to supply chain reorganization will increase by an average of 15-22%, warning that this could rise by up to 30% in the advanced semiconductor sector. Notably, global semiconductor leaders like South Korea's Samsung Electronics and SK Hynix are in a position where they must make strategic decisions about where to relocate their production bases. Samsung Electronics confirmed the construction of a new $17 billion foundry plant in Texas, USA, in 2024, aiming for operation in the first half of 2026. SK Hynix also announced in 2025 its plan to invest $3.9 billion in Indiana to build an advanced packaging facility. Under pressure from the US government, South Korean companies are compelled to re-evaluate new investments while simultaneously facing complex calculations regarding the benefits of subsidies and tax incentives offered through the CHIPS Act. South Korea's Position Amidst Supply Chain Reorganization and Geopolitical Risks Experts offer diverse perspectives on these developments. In a March 2025 feature article for MIT Technology Review, economist Anne Case analyzed, "The escalating technological rivalry between the US and China is not merely a competition; it is forming structural barriers in the global economy." She added, "While similar to the economic bloc formation of the 1980s Cold War era, it presents a far more complex picture due to the interconnectedness of the digital economy." Semiconductors, in particular, are a critical resource that forms the foundation of advanced technology industries, including AI, quantum computing, and big data analytics, extending beyond simple electronic components. In a September 2025 cover story, The Economist declared, "Semiconductors are the oil of the 21st century," pointing out that "the core of technological hegemony competition lies in who controls this resource." Professor Kim Young-min of the Korea Advanced Institute of Science and Technology (KAIST) advises, "While the South Korean sem
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