The Meaning of Export Controls in the Era of Advanced Global Supply Chains : Focusing on the Effects and Outcomes of Japan's Export Controls on South Korea

This study examines the impact of Japan's July 2019 export control measures on three semiconductor materials—hydrogen fluoride, fluorinated polyimide, and photoresist—on South Korea's semiconductor industry and both economies. The findings show that Japan's export restrictions did not seriously hurt the Korean semiconductor industry, but rather had negative consequences for Japanese companies. As a countermeasure to Japan's export restrictions, South Korea has promoted “de-Japanization,” which has achieved some results, but it still shows a high degree of dependence on high-purity materials from Japan. In addition, a new risk factor has emerged in the form of increased dependence on China. In other words, in a situation where the economic dependence between the two countries is mutually complementary, Japan's export restrictions have had negative consequences for both countries. Japan lost its share of the Korean semiconductor market, and sales of Japanese products plummeted due to the Korean boycott. On the other hand, South Korea faced the problem of increased production risk and supply chain instability in the process of securing alternative import sources and strengthening domestic production capacity. In conclusion, cooperation between the two countries is essential for the maintenance and development of the semiconductor industry in an advanced global supply chain structure, and measures such as export restrictions are inefficient policies that negatively affect the economies of both countries.