South Korea's ruling party on Monday proposed a special legislation for the chip industry in response to possible trade protection measures by the new US President Donald Trump and the potential risks brought about by this… It is understood that the bill aims to provide subsidies to domestic chip manufacturers and exempt national working hours restrictions to enhance South Korea's competitiveness in the global semiconductor industry. The semiconductor industry occupies a pivotal position in the South Korean economy. As Asia's fourth-largest economy, South Korea's chip exports accounted for 16% of its total exports last year. Last week, South Korean President Yoon Seok-yeol warned that Trump's threat to impose high tariffs on imports from mainland China could prompt mainland Chinese competitors to slash export prices and weaken the competitiveness of South Korean chip companies in the international market. Against this backdrop, the bill proposed by South Korea's ruling party is particularly important. The bill includes financial subsidies for chip manufacturers and exemptions from the national working hours cap, allowing employees engaged in research and development to extend their working hours to improve production efficiency and competitiveness. The bill was proposed at a time when South Korean chip manufacturers such as Samsung Electronics are facing increasing competition from regional competitors such as Taiwan and mainland China. However, the passage of the bill is not without obstacles. It needs approval from the main opposition party, which controls a majority of seats in parliament. In addition, Samsung Electronics' union has objected to the extended working hours in the bill, arguing that the company should not blame the law for "management errors." Last month, Samsung Electronics apologized for its disappointing profits, admitting that it fell behind rivals TSMC and SK Hynix in taking advantage of growing demand for artificial intelligence chips. Trump has also previously threatened to cancel federal chip subsidies for companies such as TSMC, Samsung and SK Hynix and instead impose import tariffs, further exacerbating uncertainty in South Korea's chip industry. South Korea's bill is not only a response to external trade threats, but also an urgent need to enhance internal competitiveness. It shows that as competition in the global semiconductor industry becomes increasingly fierce, South Korea is actively seeking to maintain its leading position in the global chip market through legislative means.
Post time: Nov-12-2024
