Surge in South Korea's Chip Exports to Taiwan and Vietnam Signals Supply Chain Shift

South Korea's semiconductor exports to Taiwan and Vietnam surged in 2024, indicating a shift in global supply chains. Ministry data shows a record USD 141.9 billion in exports, driven by increased trade with Taiwan and Vietnam. The trend reflects South Korea's strategic diversification amid US-China trade tensions.

South Korea's semiconductor exports to Taiwan and Vietnam saw remarkable growth last year, unveiling a shift in global supply chain dynamics, a report by Korea's JoongAng Daily highlighted on Sunday. The surge underscores Seoul's strategic move to diversify its semiconductor trade amidst evolving global market conditions.

According to South Korea's Ministry of Trade, Industry and Energy, the country's semiconductor exports achieved a record-high of USD 141.9 billion (NTD 4.67 trillion) in 2024, surpassing the former peak of USD 129.2 billion set in 2022, Taiwan News detailed. During January to November 2024, China's share of South Korean chip exports declined to 51.7 percent, down from 61.1 percent in 2020, while Taiwan's share jumped from 6.4 percent to 14.5 percent.

The uptick in exports to Taiwan is tied to advanced high-bandwidth memory (HBM) chips, with industry insiders noting SK Hynix's supply to TSMC, which integrates them into GPUs for Nvidia. These GPUs are crucial for AI accelerators, spotlighting Taiwan's pivotal role in global chip manufacturing, according to Taiwan News.

Similarly, semiconductor exports to Vietnam climbed from 11.6 percent in 2020 to 12.9 percent in 2024, driven by firms like Samsung shifting substantial portions of their smartphone production from China to Vietnam, redefining the region's supply chain landscape. Kim Yang-paeng, from the Korea Institute of Industrial Economics and Trade, suggested that the US's 'America First' policy is set to reshape the semiconductor supply chain significantly. "This strategy will likely compel US allies to join forces in the ongoing trade skirmish with China," Kim stated, as reported by Taiwan News.

This policy may encourage stronger collaboration among allied nations while intensifying the challenge to China's hegemony in the global semiconductor market. (ANI)

(With inputs from agencies.)