SEOUL, December 16 (AJP) - South Korea’s semiconductor industry is confronting intensifying competition from regional players like Taiwan, Singapore, and Malaysia as global powers race to dominate the burgeoning artificial intelligence chip market, according to a recent report by the Korea Trade-Investment Promotion Agency (KOTRA).
The report, which analyzed export competition trends from 2019 through the third quarter of 2024, found that China remains South Korea’s closest competitor, with an export competition index score of 72.2. However, this marks a 3.1-point decline since 2019.
“China is rapidly catching up with South Korea in memory semiconductors, while Taiwan has taken the lead in system semiconductors,” the report noted.
Taiwan, the world’s third-largest semiconductor exporter, has shown the most significant increase in competition with South Korea. Its competition index rose by 7.6 points over the past four years to 32.5, driven by its dominance in chip design and foundry services.
Singapore has also emerged as a major contender, capitalizing on U.S.-China tensions to attract substantial semiconductor investments. Recent projects include TSMC’s $7.8 billion wafer plant joint venture with NXP and GlobalFoundries’ $4 billion facility. Meanwhile, Malaysia, ranked fifth in global semiconductor exports, has seen its competition index with South Korea climb by 6 points to 50.5 since 2019.
As South Korea aims to solidify its position among the world’s top five semiconductor exporters by next year, KOTRA underscored the urgency of securing competitive advantages.
"Expanding export market share through technological innovation in advanced industries is critical,” the report stated, highlighting the need for robust government support through subsidies and deregulation.
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