[Op-Ed] Economic Coercion
June 14, 2023
This article was published in The Korea Times on June 14, 2023.
The decision by the Cyberspace Administration of China to ban Micron Technology’s semiconductors in Chinese infrastructure has put South Korea in the middle of the dispute between Washington and Beijing over the future of China’s semiconductor industry. While there are immediate issues for South Korea and the United States to consider, the dispute highlights the need for South Korea and the United States to engage in deeper discussions in the medium-to-long term on how to handle economic coercion by China.
The current dispute stems from efforts by the U.S. to restrict China’s access to the most advanced semiconductors for reasons of national security. The development of artificial intelligence is enhanced by the increased computing power advanced semiconductors provide and is expected to have a significant impact on how wars are fought in the future. But advanced semiconductors are also critical for supercomputers to improve the flight accuracy of ballistic missiles and to power advanced fighter jets and missile defense systems.
With China aiming to surpass the U.S. in these technologies the development of China’s semiconductor industry and its access to advanced chips has become a key area of concern for U.S. national security and its ability to meet military commitments in the Indo-Pacific.
Depending on how China’s ban is interpreted by domestic companies, the effect could be limited. Micron primarily supplies semiconductors to firms producing smartphones and computers rather than manufacturers of equipment for critical infrastructure. However, if Chinese manufacturers of consumer electronics interpret China’s partial ban as a signal that they too should cut ties with Micron, it could impact 10 percent of the firm’s business.
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