Sail across the sea

Chapter 460 Did President Cui really need to wait until now?
Cui Jingran is not a time traveler, so he believes that the United States will learn a lesson from what happened in Japan.

At the same time, he is a pure-blooded Korean with an innate, enigmatic self-confidence. He firmly believes that Korea will become the Japan of today, a competitor of the United States.

This means that something similar to the Plaza Accord could happen to South Korea in the future.

"You mean, when the United States feels that South Korea's semiconductor industry is a threat, it will support another country to fight against South Korea, just like it is supporting South Korea now?" Choi Kyung-ran asked.

Gao Fan shook his head: "This is too troublesome. I don't think the Americans will have the patience to support a new replacement."

So what do you think the Americans will do?

"The Americans have already started planning this; that's the conspiracy I was talking about."

"You mean, the photoresist problem is a setup by the Americans?"

Cui Jingran recalled what Gao Fan had just said, but he hadn't fully sorted out his thoughts yet, so he needed to ask Gao Fan for guidance.

Gao Fan said, "The United States is suppressing Japan's semiconductor production and pushing Japan's semiconductor manufacturing capabilities to be transferred to South Korea. However, the situation is different from when it supported Japan's development of semiconductors. This time, the United States has not cultivated a complete semiconductor industry chain in South Korea, but has left the semiconductor equipment manufacturing and semiconductor chemical capabilities in Japan."

"This is why?"

"It's very simple. If one day the United States thinks that South Korea's semiconductor industry is developing too fast and wants to suppress it, it will not need to bother to find any proxies. It can simply order Japan to cut off the export of semiconductor chemical products to South Korea."

"How can this be!"

Cui Jingran almost jumped up, nearly spilling the coffee in his hand.

Honestly, although he was thinking about how to compete with Japanese manufacturers every day, he never thought that Japan would impose an embargo on semiconductor and chemical products on South Korea, let alone that the United States could use this to make things difficult for South Korea.

Wait a minute, isn't the United States a beacon of free trade? How could it possibly do something that hinders free trade?

Shouldn't the market determine who Japanese manufacturers sell their photoresist to? Adam Smith and Hayek both raised this question; isn't it a universal truth?

However, the scene Gao Fan described was so terrifying that he dared not harbor any illusions.

The photoresist used in the production of Guangchen Semiconductor is mostly sourced from several Japanese manufacturers.

If, just if, something unpleasant happens between South Korea and Japan, causing a temporary halt in trade between the two countries, Guangchen Semiconductor will face a situation where there is no photoresist available. At that time, all production will have to stop, and the daily losses will be calculated in tens of millions of dollars.

How much is a little bit of photoresist worth?

Guangchen Semiconductor only purchases around $2000 million worth of photoresist annually. If Japanese manufacturers were to cancel those $2000 million orders, they could completely cripple Guangchen Semiconductor. Is such an exchange something the Japanese are capable of?
"If that's the case, then..."

Cui Jingran was almost talking to himself, trying to find a way to break the deadlock.

Gao Fan sneered, "Is President Cui thinking that Guangchen Semiconductor should establish its own photoresist manufacturing company?"

"Perhaps this is one way." "If it could be built, would President Cui have needed to wait until now?"

"what do you know?"

Cui Jingran stared at Gao Fan, somewhat incredulous.

Gao Fan said, "If I'm not mistaken, the Americans do not support South Korea in establishing its own semiconductor chemical system. Their reason is that doing so would impact Japan's existing industries and lead to unnecessary trade friction."

Cui Jingran sighed softly.

That's absolutely right, that's exactly what Americans say.

South Korean electronics manufacturers are not in a strong urgency to establish their own semiconductor chemical industry, because Japan's semiconductor chemical industry is so advanced and the transportation costs between the two countries are not high. South Korea really has no need to develop its own.

But Choi Kyung-ran also knew something else: several South Korean chemical companies had considered entering the semiconductor chemical industry and had even approached electronics manufacturers to inquire whether they would accept their products. Ultimately, however, nothing came of it.

According to some rumors, it was the Americans who intervened to dissuade these South Korean chemical companies, one of the reasons being to avoid unnecessary trade friction with Japan.

Now, after Gao Fanyi's reminder, Cui Jingran suddenly realized that the Americans had done this deliberately, with the aim of breaking up the entire electronics industry chain, leaving a segment to each country so that no one could independently complete the production.

In this way, every country would have to be mindful of the United States' wishes. Otherwise, the Americans could simply have other countries cut off their product supplies to a country, causing that country's industry to collapse completely.

A tiny piece of photoresist can cripple the entire South Korean semiconductor industry. If you also consider specialty gases, grinding powders, and metal materials, the seemingly glamorous South Korean semiconductor industry is riddled with weaknesses and can be easily crippled.

Is it possible to disregard the advice of the Americans and forcibly establish our own semiconductor chemical system?

The thought only flashed through Cui Jingran's mind before he dismissed it.

Not to mention that American soldiers are stationed right under their noses, even if we're just talking about economic issues, South Korean manufacturers aren't at the point where they can say no to the United States.

Many large South Korean companies have American capital stakes. Most of the core technologies of South Korean companies originate from the United States, and they still require licenses from American companies. Furthermore, their sales markets are also a gift from the United States to South Korea.

Under these circumstances, how could South Korea possibly disobey the United States' arrangements?
Even if you know perfectly well that the Americans are putting a noose around your own neck, do you still have the right to refuse?

"What Korean companies cannot do, Chinese companies can do."

Gao Fan finally revealed his trump card:

"At this exhibition, we brought i-line and KrF photoresist with completely independent intellectual property rights. Their quality is comparable to similar products from Moriya in Japan."

"My personal suggestion is that Guangchen Semiconductor consider using some Chinese photoresist, complete the testing based on Chinese photoresist, and establish a production process."

"In this way, if Japanese manufacturers cut off supplies to South Korea, Guangchen Semiconductor will not be without a fighting chance. With the help of China's photoresist supply, Guangchen Semiconductor will have the confidence to negotiate with the Japanese."

(End of this chapter)