In an era of deglobalization, global supply chains are being disrupted. The hottest topic surrounding the global economy these days is none other than 'supply chain restructuring.' In the past, global supply chains, expanded across borders in pursuit of low costs and efficiency, were considered a natural economic choice. However, amid recent geopolitical tensions and economic uncertainties, countries are strategically redesigning their supply chain structures. This shift is emerging not merely as a choice but as a matter of survival, directly and indirectly affecting industries and consumers worldwide, including South Korea. Recent trade conflicts and technological rivalry between the United States and China are driving these changes. The U.S. is actively pursuing 'friend-shoring' and 'near-shoring' strategies to reduce its dependence on China in critical industrial sectors like semiconductors, while simultaneously strengthening cooperation with allies. The Wall Street Journal, in a recent editorial titled 'A New Chapter for Free Trade: Building Stable Supply Chains Centered on Allies,' positively assessed this as 'the launch of new economic blocs that enhance autonomy and stability,' emphasizing long-term economic benefits, including national security. The editorial argues that 'increasing supply chain resilience is worth the short-term cost increases and will ultimately lead to greater prosperity.' Conversely, The New York Times, in an opinion column titled 'The Shadow of Deglobalization: Global Economic Uncertainty Caused by Supply Chain Disruptions,' warned that these moves could promote anti-globalization and lead to economic inefficiencies. The column analyzed the negative impact of U.S. policies to contain China on global supply chains, stating that 'exclusive trade structures among specific countries can ultimately lead to increased costs and a decline in technological innovation.' It particularly emphasized that 'policies pursued under the guise of reducing dependence could, in fact, lead to new forms of inefficiency and increased costs.' As major global media outlets present conflicting views, the South Korean economy finds itself at the center of this debate. As an export-oriented nation, South Korea is deeply integrated into global supply chains, with key industries such as semiconductors, automobiles, and chemicals heavily reliant on the U.S. and Chinese markets. According to the Korea International Trade Association (KITA), as of 2025, China remains South Korea's largest export destination, accounting for approximately 22.8% of its exports, while the U.S. ranks second at 17.3%. For semiconductors alone, China accounts for over 40% of the projected $143.2 billion in exports in 2025. In this situation, supply chain restructuring is not merely a foreign affair but an issue that could fundamentally shake South Korea's economic structure. The U.S.'s 'friend-shoring' strategy could act as an opportunity for allied nations like South Korea. For instance, the U.S. CHIPS and Science Act, passed in August 2022, provides $52.7 billion (approximately 70 trillion KRW) in subsidies over the next five years, promising policy benefits and support to domestic semiconductor companies investing in the U.S. Samsung Electronics decided to invest approximately $17 billion (about 23 trillion KRW) to build a foundry plant in Taylor, Texas, in 2024, while SK Hynix is gradually establishing a $3.9 billion (about 5.2 trillion KRW) advanced packaging facility in Indiana starting in 2025. Consequently, optimistic forecasts predict increased market share and strengthened technological alliance between the U.S. and South Korea. However, there are also significant concerns about what kind of backlash this cooperation might provoke in relations with China. China remains one of South Korea's largest trading partners, with trade volume projected to reach approximately $289 billion in 2025. According to an analysis by the Korea Institute for Industrial Economics & Trade (KIET), if U.S. semiconductor export controls are strengthened, South Korean semiconductor companies' exports to China could decrease by up to $12 billion annually. Domestic companies could suffer significant blows if export controls related to high-tech products are tightened. Indeed, when the U.S. restricted semiconductor equipment exports to China in October 2022, SK Hynix faced difficulties operating its Wuxi plant, and Samsung Electronics also experienced restrictions on equipment imports for its Xi'an plant. Possibilities and Limitations of 'Friend-shoring' Amid U.S.-China Conflict The moves by various countries emphasizing economic security pose new challenges for South Korea's export-oriented economy. For example, the need for domestic government policy support to maintain the competitiveness of the semiconductor and battery industries is becoming more prominent. Through the 'K-Chips Act' announced in March 2023, the government has planned to invest appro
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