South Korea will try to persuade the US to let its chipmakers in China retain current levels of semiconductor investment, a news report said, as Washington prepares to roll out further provisions to prevent investment flowing into China.
(Bloomberg) — South Korea will try to persuade the US to let its chipmakers in China retain current levels of semiconductor investment, a news report said, as Washington prepares to roll out further provisions to prevent investment flowing into China.
The basic purpose of the so-called guardrail provision is to prevent companies that receive US subsidies from conducting business in countries of concern, Yonhap News reported Tuesday, citing Foreign Ministry officials. South Korean officials are discussing various ways for its country’s companies already investing in China to avoid harm, the officials told Yonhap.
South Korean companies won a one-year reprieve from sweeping US export controls unveiled in October that prevent chipmakers from bringing in equipment for their advanced facilities in China. Without a license extension, it is unclear how Samsung Electronics Co. and SK Hynix Inc. would proceed — both depend on China as a key market and a manufacturing site for their memory chips.
Read: US Likely to Put a Tech Cap on South Korean Chipmaking in China
The Biden administration is seeking help from its global partners to impose sweeping curbs on the sale of advanced chips equipment to China in a policy aimed at preventing the country’s progression in a range of cutting-edge technologies that could threaten America’s status as the world’s preeminent power.
Read: US, Asian Partners Discussed Supply Chains in ‘Chip 4’ Talks
The so-called Chip 4 grouping of the US, South Korea, Japan and Taiwan held a video conference on Feb. 16 to discuss an early warning system to ensure a steady chip supply, while holding off on discussions concerning export controls.
US, Japan and South Korea also held a separate economic security dialogue on Monday to discuss semiconductors and other advanced tech issues.
–With assistance from Shinhye Kang and Debby Wu.
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