Moving on Up
After the outbreak of the U.S.-China trade conflict, in the U.S. imported semiconductor market, the share of Chinese-made semiconductors shrank by one-third while that of Taiwanese-made products has doubled over the past four years. That of Korean-made chips inched up a bit as well.
China’s share of the U.S. imported semiconductor market fell from 30.2 percent to 11.7 percent in 2018 from 2022, according to an analysis by the Federation of Korean Industries (FKI) based on data from the U.S. International Trade Commission (ITC). China held the top spot in the U.S. imported semiconductor market from 2003 to 2018, but since then its share has declined, falling to fourth place in 2022. The U.S. government imposed additional tariffs of 10 to 25 percent on mass imports on three occasions in 2018 and continued to do so the following year. Around the same time, it also restricted the export of parts and equipment made using U.S.-made technology and software to China.
While the United States sanctioned China, Taiwan’s share soared from 9.5 percent to 19.2 percent. Its ranking jumped from fourth place to first place over the same period. South Korea moved up to third place in 2017, when the U.S. memory market was booming, and stayed at the same position until 2022. Comparing the shares of Korea and Taiwan, Korea’s was 1.3 percentage points higher than Taiwan’s in 2017 but Taiwan’s was 6.6 percentage points higher than Korea’s in 2022.
Vietnam also benefited from U.S. sanctions on China, expanding its share from 2.5 to 9.8 percent. Malaysia, which is home to an Intel factory, saw its share slide from 22.8 percent to 18.3 percent but maintained second place.
The analysis also found that Taiwan and Vietnam have benefited from U.S. pressure on China in the areas of parts such as semiconductors for computers, which are the largest U.S. import item. While China’s share of the U.S. import market in this area fell by 15 percentage points, Taiwan’s and Vietnam’s shares rose by 6.8 and 3.5 percentage points, respectively. In the fast-growing category of integrated circuits, imports from Taiwan swelled by 119 percent from US$1.84 billion to US$4.03 billion. U.S. imports of organic light-emitting diodes and solar cells and photovoltaic modules from Vietnam, which are also growing rapidly, grew by 874 percent from US$390 million to US$3.8 billion.