Korea laughs over US semiconductor and battery supply chain inspection

Input 2021.02.25 09:47

U.S. President Joe Biden launched an inspection of the supply chain of key resources, including semiconductors, rare earths, and electric vehicle batteries. Although it did not mention China, which is in a trade dispute, it is interpreted as a willingness to protect the US industrial base in solidarity with allies such as Korea, Japan and Taiwan, with the possibility of blocking China’s supply chain in mind.

It is characterized by including semiconductor chips and vehicle batteries that Korea has a technological advantage in the global market. If the US focuses on fostering its own companies and expanding the supply chain through alliances, it will have a positive impact on Korean companies.

According to Reuters on the 24th (local time), President Biden signed an executive order that requires a 100-day review of the supply chain of four key items: semiconductor chips, large-capacity batteries for electric vehicles, rare earths, and pharmaceuticals.

These items, coupled with the spread of Corona 19, have experienced difficulties in supply and demand in the US global supply chain.

In addition to the four items, the executive order also requires a one-year supply chain review for six industries, including defense, health, information and communication technology, energy, transportation, and agricultural products and food.

President Biden said, “We need to make our supply chain safe and reliable (of the four core industries). “Semiconductor chips are a major field that drives everything from automobiles to telephones and medical devices.”

Japan’s Nikkei reported that President Biden appealed for the need for supply chain review, saying, “We cannot rely on foreign countries that do not share our national interest values,” with China in mind before signing the executive order. .

President Biden also made clear his will to strengthen cooperation with allies to stabilize the supply chain. “It is also important to increase production in the United States to ensure the resilience of the supply chain, but it must work closely with partner countries that share value and trust,” he said.

It is interpreted as meaning that the dependence on China, which occupies a dominant position in the medical supplies of rare earth batteries, should be reduced.

It is observed that if the Biden administration’s review focuses on reducing dependence on China on these items and expanding and strengthening the supply chain through alliances, it will work in an advantage for Korea. On the other hand, the result may be toward fostering own companies or attracting foreign companies by focusing on increasing the production of these items in the US.

Reporter Lee Kwang-young [email protected]

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