The Woori Finance Research Institute released on Sept. 10 a report on localization of industrial materials, components and equipment imported from Japan. It has found that six of the seven items it reviewed can be replaced with domestically developed ones within two to three years. Korea's imports of the seven items amounted to US$1.1 billion last year. The institute says 78 percent of these imports could be replaced with domestically produced items.
At present, the Japanese government is restricting the export of fluorine polyimide, hydrogen fluoride and photoresist to South Korea. When it comes to the three, South Korea’s imports from Japan totaled US$390 million last year. Although the sum was only 0.7 percent of its total imports from Japan, South Korean manufacturers have been heavily dependent on Japanese suppliers for the three materials.
According to the institute, fluorine polyimide is the item that can be most easily replaced among the three. South Korean companies’ fluorine polyimide imports from Japan added up to approximately US$20 million last year and South Korean companies such as Kolon Industries, SKC, SK Innovation and Innox Advanced Materials are regarded as being capable of developing it on their own.
On the other hand, the institute pointed out that hydrogen fluoride for use in semiconductor manufacturing processes cannot be replaced in the near future because it requires a purity level of at least 99.999 percent. “The yield and productivity of domestically supplied hydrogen fluoride remain to be seen,” the institute said.
“Photoresist is even more irreplaceable,” it continued to say, adding, “South Korea’s degree of dependence on Japanese photoresist suppliers amounted to 93.1 percent last year, whereas its degree of dependence on Japanese fluorine polyimide suppliers fell from over 90 percent to 42 percent from 2005 to 2018, and this is because of the lack of technology in South Korea.”