U.S. President Biden is stepping up efforts to crack down on Chinese semiconductors, and South Korean President Yoon Seok-yue's attitude has attracted much attention.

(European News Agency)

[Financial Channel/Comprehensive Report] The United States is actively combining its allies to carry out anti-China efforts. At the same time, Beijing has also increased pressure on Seoul. The position of South Korea has once again attracted attention. At the end of August, South Korean President Yin Xiyue did not personally receive the US House of Representatives on the grounds of leave. Pelosi, the speaker, is seen as avoiding upsetting China.

Japanese media believe that as the rift between the United States and China expands, South Korea’s diplomatic strategy is facing a crossroads, especially when the United States is promoting the chip alliance between the United States, Japan, Taiwan and South Korea (Chip4), which is the moment to test South Korea’s loyalty.

"Nikkei Asia" reported that in order to stabilize the semiconductor supply chain, the United States is preparing to hold a preparatory meeting for the Chip 4 Alliance (Chip4) composed of the United States, Japan, Taiwan and South Korea.

At present, the details of Chip4 have not been finalized, and the goal is very clear, which is to point to the Chinese semiconductor industry.

The Chip4 initiative will create a dilemma for South Korea, which has long maintained a balance between China's economic relations and U.S. security cooperation.

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According to statistics, in 2021, China will account for 24% of South Korea's total trade, making it South Korea's largest trading partner.

In the same year, 60% of South Korea's total semiconductor exports went to China, as did the rest such as chemicals, machinery and other key products.

If China raises tariffs or imposes sanctions, it could hit South Korea's core industries hard.

In addition, about 20% of Samsung Electronics' NAND Flash memory is produced in Xi'an, China.

SK Hynix operates a factory in Wuxi and will acquire Intel's Dalian factory in 2021. Up to 40% of NAND Flash memory is also produced in China.

Although South Korean President Yoon Seok-wook has vowed to make the U.S.-South Korea bilateral alliance a priority and expressed interest in Chip 4, Yoon's focus on Washington does not appear to be rock solid, the report pointed out.

When U.S. House Speaker Nancy Pelosi visited South Korea in August, Yoon did not receive Pelosi in person, citing that she was on vacation.

"Even though Yin was in Seoul, he only spoke to Pelosi on the phone, which was seen as a move to avoid upsetting China."

The report emphasized that as the rift between the United States and China widens, South Korea's diplomatic strategy is facing a crossroads, and whether Yoon decides to sign the Chip4 initiative will affect South Korea's economic prospects.

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