China, South Korea To Strengthen Cooperation On Chips, Says Beijing

TO GO WITH China-US-IT-Internet-lifestyle-Apple,FOCUS by Tom Hancock This picture taken on April 22, 2015 shows Chinese workers assembling a cheaper local alternative to the Apple Watch in a factory producing thousands every day in Shenzhen, in southern China's Guangdong province. The much-hyped Apple Watch goes on sale on April 24, but Chinese factories are already churning out cheaper alternatives to the apparent delight of local consumers. CHINA OUT AFP PHOTO (Photo credit should read STR/AFP/Getty Images)
  • Chinese commerce minister Wang Wentao and South Korean trade minister Ahn Duk-Geun spoke about maintaining the stability of the industrial supply chain.
  • South Korea said that Ahn requested support from Beijing to stabilise the supply and demand of key raw materials and parts.

China’s Commerce Ministry issued a statement saying that the Chinese and South Korean governments have agreed to strengthen dialogue and cooperation on semiconductor industry supply chains, amid broader global concerns over chip supplies, sanctions and national security.

At the Asia-Pacific Economic Cooperation (APEC) trade ministers’ meeting in Detroit, Chinese commerce minister Wang Wentao and South Korean trade minister Ahn Duk-Geun exchanged views on maintaining the stability of the industrial supply chain and strengthening cooperation in bilateral, regional and multilateral fields.

South Korea did not hint at any discussion on the semiconductor sector. It said that Ahn requested support from Beijing to stabilise the supply and demand of key raw materials and parts.

Caught in a row

The Chinese commerce ministry’s announcement comes at a time when Seoul finds itself in a cross-fire between Washington and Beijing’s tech trade war. Seoul is a part of the US-led Chip 4 alliance, along with Taiwan and Japan, to build a semiconductor supply network, which has affected relations with China.

China is one of the biggest markets for South Korean semiconductor firms Samsung Electronics Co. and SK Hynix Inc. These firms also have some of their factories based in China but the continuity of their operations in China is dependent on licences granted by Washington. This gives the US certain leverage over Seoul’s decisions on how the latter balances its economic engagement with both countries.

Last week, China’s cybersecurity watchdog said that Micron’s products posed security risks to its critical information infrastructure supply chain and national security, banning the chipmaker from selling any products in the country.

Soon after the trade meeting, South China Morning Post reported that the South Korean government wouldn’t encourage its memory-chip firms to grab market share in China lost by Micron.


 

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