A recent study shows that South Korea's next-generation semiconductor technology has lagged behind the United States for the fourth consecutive year. The focus is on how much South Korea's upcoming government support plan of at least 10 trillion won will enhance the competitiveness of the industry, as the United States and Japan directly provide huge subsidies to attract semiconductor companies.
On May 13th, the Korea Institute of Industry Technology Evaluation and Management (KEIT) released the 2023 Industry Technology Level Survey Report, which published research results on the industry technology level and relative technology gap of major countries/regions worldwide (South Korea, the United States, Japan, China, and the European Union). Based on the United States (with a technology level of 100%), the average industrial technology level in South Korea is 88.0% (with a technology gap of 0.9 years), the EU is 93.7% (with a technology gap of 0.39 years), Japan is 92.9% (with a technology gap of 0.39 years), followed by China at 83.0% (with a technology gap of 1.2 years).
If the top technology level in the United States is considered a 100% standard, the next generation semiconductor technology level in South Korea has decreased from 90.1% in the last survey to 86.0%.
The next generation semiconductor technology in South Korea reached 92.9% of the US level in 2019, decreased to 90.1% in 2021, and further fell below 90% in 2023.
Especially for system semiconductors that are crucial for the development of generative artificial intelligence (AI), they only reach 81.6% of the US level. The technological gap between South Korea and the United States has widened to 1.3 years. China closely follows with 80.5% technological level.
Considering that semiconductors account for about 20% of South Korea's exports, experts are concerned that the weakening of semiconductor competitiveness may have adverse effects on future economic growth. The Korean Semiconductor Industry Association reports that South Korea only holds a 3% market share in the system semiconductor field, while the United States holds 70%.
An Gi hyun, Executive Director of the Korea Semiconductor Industry Association, emphasized the need for bolder, proactive, and sustained support measures to cultivate the system semiconductor industry, and stated, "In the medium to long term, it is necessary to establish an ecosystem where the system semiconductor industry can grow independently."
Looking at the 25 major industrial and technological fields, the area with the largest technological gap between South Korea and technology leading countries/regions is next-generation aviation, which is 2.9 years old; Next are carbon materials (with a technology gap of 1.5 years), ceramics (with a technology gap of 1.4 years), and metal materials (with a technology gap of 1.2 years). South Korea is only at the forefront of future display technology. The areas that South Korea can catch up with within six months include electric hydrogen vehicles (with a technology gap of 0.3 years) and smart homes (with a technology gap of 0.4 years).
From a technical perspective, apart from displays and secondary batteries, the United States has the highest level of technology among all 47 technologies, accounting for 64.5%, while Japan has 14, leading in ceramics, carbon materials, and root technology; In addition to the five technologies in future display, South Korea is in a leading position in "commercial high-performance lithium battery technology" and "lithium battery reuse technology"; Europe has the highest technology in advanced manufacturing processes and equipment, as well as shipbuilding and offshore factories.
The overall technological gap between the United States and South Korea has widened over the past eight years. Expanding from 1.4 years in 2013 to 1.5 years in 2015, but maintaining or narrowing to 1.5 years in 2017, 1.3 years in 2019, and 0.8 years in 2021.
Experts unanimously believe that in order to restore lost technological competitiveness, the South Korean government needs to increase research and development investment.
