Localization Efforts Pay Off
The Japanese government implemented export restrictions against South Korea in July 2019 regarding certain display and semiconductor materials. Then, the South Korean government increased its support for material, component and equipment suppliers.
According to industry sources, South Korea’s dependence on Japan related to 100 strategic items has decreased by 6 percentage points as a result of the measure and the dependence on Japanese hydrogen fluoride, photoresist and fluorinated polyimide is continuing to decrease.
The South Korean government initiated its import replacement projects in November 2019. In the projects, 380 billion won for R&D assistance is scheduled to be given until 2025 along with tax incentives and deregulation.
The dependence related to the 100 items was 30.9 percent in December 2019 and 24.9 percent at the end of last year. South Korea’s hydrogen fluoride imports from Japan dropped from US$36.3 million to US$12.5 million from December 2019 to December 2021. At present, the reliance on Japanese photoresist is less than 50 percent and that on Japanese fluorinated polyimide is close to zero.