The Korea Herald


Uncertainties alleviated for Samsung, SK chip plants in China: trade chief

Minister touts equipment reentry as outcome of close cooperation between Seoul, Washington

By Jie Ye-eun

Published : Oct. 17, 2023 - 15:22

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South Korean Trade Minister Ahn Duk-geun speaks at a public-private strategy meeting on the Indo-Pacific Economic Framework in Seoul on Oct. 6. (Yonhap) South Korean Trade Minister Ahn Duk-geun speaks at a public-private strategy meeting on the Indo-Pacific Economic Framework in Seoul on Oct. 6. (Yonhap)

South Korea’s Trade Minister Ahn Duk-geun said Tuesday that the US government’s recent decision to allow exports of its chip equipment to Samsung Electronics and SK hynix plants in China has greatly relieved uncertainties surrounding the top memory chip makers’ operation and investment there.

“The latest achievement came after mobilizing all consultation channels centering on the presidential office and the Ministry of Trade, Industry and Energy, while closely communicating with firms to extend their granted one-year waiver period,” Ahn said in a press conference held at the government complex in Sejong earlier in the day.

The presidents of both Korea and the US continuously confirmed their commitment to close cooperation on advanced industrial supply chains and export controls centered on chips at a series of events, including the Camp David summit in Maryland in August.

Additionally, a total of 14 consultations had been held between the two countries, including two meetings at the ministerial level, to give more leeway to Korean chipmakers, according to the trade chief.

The US Commerce Department's Bureau of Industry and Security on Friday officially issued a rule updating general authorizations for Samsung and SK to keep supplying their China-based plants with certain US chip manufacturing equipment. It set Samsung’s NAND flash memory chip plant in Xian and SK’s DRAM manufacturing facility in Wuxi as exceptions to rules issued in October 2022.

About a year ago, the US government announced a set of rules to restrict exports of certain advanced chip manufacturing equipment and items to companies in China in a bid to slow down China's technological and military advances.

Regarding the US’ final rule concerning national security "guardrails" of the CHIPS and Science Act last month, Ahn gave a positive evaluation, saying, “With the final confirmation of detailed regulations, (Korean companies’) normal business activities without security concerns have been guaranteed.”

“It has been clear that maintenance and partial expansion of production facilities operating in China are possible and technical upgrades to existing facilities are also allowed,” he said. “Since equipment has been excluded from the scope of facility expansion restrictions, routine equipment replacement became possible as well.”

The trade minister said the Korean government plans to continue its cooperation with the US government, while highlighting that cooperation without security concerns is recognized as an exception and ongoing research can continue through consultation with the US Commerce Department.

"We'll closely consult with the industry on related issues and continue to cooperate with the US government to strengthen the global chip supply chain and ensure the investment and management activities of domestic companies," Ahn said.