Japan and South Korea’s trade war is the best

Japan and South Korea’s trade war is the best

Just as the world is concerned about Sino-US trade wars and Huawei being sanctioned, similar wars have erupted between Japan and South Korea. The Japanese government suddenly announced yesterday that it will limit the export of semiconductor materials necessary for three kinds of wafers, LCD screens and mobile phone panels. South Korea, because Japan accounts for 90% of the global supply of these three materials, the degree of “dominant" far exceeds that of rare earth in China, which will hit South Korea’s enterprises such as Samsung and LG. On the surface, the Japanese government’s move this time is to counter the South Korean court’s claim for compensation for World War II, but it’s about the “fighting battle” of Japan’s and South Korea’s technology industry, as well as the restructuring of the global industrial chain, especially in the Sino-US trade war. Under the two countries, both countries want to “fishers profit."

Revenge for World War II compensation, limited semiconductor materials to Korea

The G20 summit in Osaka has just ended. As the host of Japan, Prime Minister Shinzo Abe is responsible for issuing a joint declaration emphasizing “working hard to build a free trade system." It is expected that the Japanese government announced the above measures yesterday to restrict the use of fluorinated polyamide. Three kinds of semiconductor chemical materials, such as photoresists and hydrogen fluoride etching gas, are exported to South Korea. Briefly, fluorinated polyamides used in LCD panel production can increase density and reduce energy consumption. Photoresists and hydrogen fluoride etch gases are used to “paint" (scribe integrated circuits) on semiconductor wafers.

Following the era of white goods (snow cabinets, air conditioners, washing machines) and black appliances (audio, television, game consoles), Japan’s technology industry seems to lack light in recent years, and has been robbed of the limelight by Apple, Samsung, Huawei and other US and Korean companies.

However, everyone in the industry knows that the Japanese continue to quietly gain advantages in the basic fields of industry and technology industry because of their “lifelong life" and “artisan spirit". For example, the global automobile engine needs a precision gear, but it has only been in Toyohashi City. Exclusively produced by a factory of more than 100 people (Yoshiyan Industry); as well as the SiC fiber of the latest F22 and F35 aircraft fuselage, it is only supplied by two Japanese factories, Ube Industries and Nippon Carbon.

The above three kinds of semiconductor materials are the same, and they seem to be insignificant. The mass consumers have never heard of these “spoken" chemical terms, but they are essential raw materials for producing wafers, LCD screens, mobile phone panels, etc., and are dominated by Japanese manufacturers. The most advanced technology, the global market share is as high as 70% to 90% (the remaining share comes from one or two generations of raw materials). In other words, if the Japanese government really bans South Korean companies from purchasing these three kinds of raw materials, then Samsung, LG and other brands will not be able to produce the top TVs, chips and mobile phones in the future, and become the second and third-tier echelons.

Science and technology grudges date back to the 1990s

A spokesperson for the Ministry of Economy, Trade and Industry said that this was in response to the counter-measures of the South Korean Supreme Court’s earlier recovery of compensation for the Second World War (strong local workers) from a number of Japanese companies. The spokesman pointed out: “Japan’s export system It is based on international mutual trust. As our mutual trust with South Korea has been damaged, the export policy needs to be adjusted accordingly."

Of course, Japan does not completely ban the export of the three materials to South Korea this time. It only requires exporters to apply for approval from the government every time. This means that the permission and the relevant amount are determined by the authorities, and each approval takes a long time. Up to 90 days, it is equal to the throat of the South Korean technology industry. The Japanese government has also threatened to consider whether to remove South Korea from the “white list". At that time, all Japanese companies exporting technology products to South Korea will apply for approval in advance.

According to the “Nikkei Business News" website reported on Monday, the Japanese government did not have a warning or a consultation before this move. Although the market has discussed restricting the sale of high-tech products to South Korea as a counter-measure, it did not expect that the authorities would resolutely implement it. In particular, this is similar to the US government’s sanctions against Huawei. It is likely to cause side effects and cause revenge in South Korea, which will also damage Japanese manufacturers and the economy. As for the specific impact, it depends on how the authorities implement the examination and approval. For example, whether it will only be “symbolic" obstruction, or whether it will be strictly restricted or even banned.

What is particularly puzzling is that the Supreme Court of South Korea earlier ruled that Japanese companies must compensate 100 million workers (about 670,000 Hong Kong dollars) for each of the four World War II workers, that is, a total of 2.68 million Hong Kong dollars, even if it is considered that there may be a few Thousands of people have been awarded compensation, and the potential amount involved is at most several billion Hong Kong dollars, not to mention “price talks"; the Japanese authorities have made a “big lethal" counter-measure, which is a bit overreacting.

In fact, Japan and South Korea’s technology industry have complained about their own grievances. In the early 1990s, the South Korean government was like today’s “Made in China 2025”, and the power of the country was subsidized to support several companies such as Samsung and LG. The low-cost strategy robbed the Japanese industry of large-scale jiangshan (then Japan also accused the Korean company of alleged theft technology).

It can be said that the above mentioned Japanese technology brands have been eclipsed in recent years. Apart from their own self-defeating and unsatisfactory attitudes (including adherence to their own standards in the fields of mobile phones and computers, and their inability to integrate into the international market), it is also related to the slamming of South Korea that year. Therefore, the two industries have long had “teeth marks".

Or provoke a counterattack dispute to heat up at any time

In addition, it coincides with the current Sino-US trade war. As President Trump pointed out, many manufacturers are now or are considering moving some of their production lines away from China. The most concerned and most valuable is the high-tech production line, Japan, Both South Korea and Taiwan are licking these “fat meats." Therefore, the Japanese authorities have made a move at the moment, and there are also many conditions of “severing South Korean rice road" and “cross-handedly fighting for business".

In any case, the follow-up impact of this incident remains to be seen, South Korea is likely to counterattack, and the dispute is getting worse. There is a paragraph in the Mainland that “China-Japan friendship depends on South Korea and China-South Korea friendship depends on Japan." It is very vivid that it describes the delicate relationship between the three powers of East Asia. In short, every day between Japan and South Korea will help China and Japan. South Korea’s relationship; while on the Sino-US trade war, if China can draw Japan and South Korea at the same time, it should be of great help. Could it be that the Tian dynasty will continue to carry out the Grand Canal and will become “the biggest winner"?