Growing Semiconductor Independence
Ever since the COVID pandemic of 2020, there has been a strong movement across nations to increase their degree of semiconductor sovereignty. The need for this comes from a multitude of reasons including how semiconductor shortages can cripple an economy, how dependent nations are on outside suppliers for key components, and how some nations will outright refuse sales to certain customers (such as export restrictions by the US and its allies that have limited China's access to some next-generation technologies). For example, China has seen substantial export controls imposed by the US and its partners, which have constrained access to certain advanced chips and manufacturing equipment and can affect development of next-generation technologies such as AI and high-end processors. If access to the latest semiconductors is restricted, it can slow aspects of technological development, rather than completely preventing it. Another example is the disruption caused when individual foundries, including facilities in Malaysia, suspended operations due to COVID-related measures or other local issues, affecting supply. Such suspensions could affect production of orders worth hundreds of millions to billions, leaving companies scrambling for alternatives. But it’s not just economic disruptions that pose a major risk; national defence is also highly affected by a lack of semiconductor access. Some countries, including Ukraine, have sought international support to rebuild and strengthen their tech and industrial bases after conflict, including critical electronics supply chains. Increasing domestic or friendly-source semiconductor production can reduce the risk that an adversary could cripple a country's ability to defend itself by cutting off chip supplies. If the last two years have taught us anything about semiconductors, it's that we are far too dependent on them, and not having access to semiconductors is a bad thing. Thus, many countries around the world including the US, UK, and EU are now looking towards building their own chips and manufacturing capacity, and this will undoubtedly lead to a new race for semiconductor sovereignty.
South Korea’s Push for Power Semiconductor Sovereignty
South Korea has launched a national initiative targeting self-reliance in next-generation power semiconductors. The government established a dedicated task force led by Koo Sang-mo, a professor at Kwangwoon University, to coordinate strategy across government agencies and industry. Power semiconductors are pivotal for controlling and converting electricity across critical infrastructure, including electric vehicles, power grids, AI data centers, defense, and robotics. The objective is to significantly raise domestic technology self-reliance by 2030. Unlike CPUs or memory chips, power semiconductors directly manage electrical flow, and advanced compounds such as silicon carbide (SiC) and gallium nitride (GaN) enable high-voltage, high-power, and high-efficiency operation in demanding applications. Koo emphasizes that self-reliance is measured not just by local fabrication but by actual deployment in core infrastructure, ensuring reliable long-term operation without foreign dependency. However, South Korea faces a steep learning curve. Europe benefits from decades of SiC experience through its automotive industry, the United States leverages high-reliability devices for AI and defense applications, and China is rapidly scaling both SiC and GaN production. Korea, as a relative newcomer, has to catch up across the entire ecosystem. To overcome these challenges, the task force is adopting a “demand-first” approach: performance and specifications for EVs, power grids, AI data centers, and defense applications are defined early, rather than developing technology first and searching for applications later. Priority sectors include AI data centers and power grids, where efficiency and reliability are paramount, with defense and robotics emerging as strategic applications. However, domestic gaps remain, particularly in raw materials, even as process, design, and foundry capabilities exist. Thus, the roadmap focuses on internalizing production while linking public and private demand to ensure widespread adoption and hands-on experience.
How far will countries go with semiconductor sovereignty?
Creating a semiconductor industry that can ensure semiconductor sovereignty is no small feat; it requires massive amounts of funding, regulation, training, and even the ability to create new rules that prevent foreign nations from getting access to cutting-edge devices. In fact, trying to create such an industry is so massive a task that even large companies (such as Intel) have struggled to do so at times. This was clearly demonstrated during efforts by TSMC to open new foundries in the US. Despite massive investment, these projects have faced local workforce skill shortages that delayed ramp-up. Thus, it is clear that just getting large sums of money is not the solution to ensuring a nation’s semiconductor sovereignty. However, if there is one thing that the world has learned since the introduction of the printing press, is that money talks. Considering that the world is now global, and people can generally travel more freely than in the past, the only real threat that countries face is migration. It is this migration that can cause issues, especially for military security, as migrants from adversary countries could, in some cases, pose intelligence risks if exploited. As such, governments around the world may consider restricting who can and cannot migrate. This restriction on migration could potentially be imposed on those from Russia and China, but some Western countries may be reluctant to impose blanket travel bans. So, who exactly would a country deny entry to? How far will governments go with this? Who knows, but one thing is clear, money isn’t everything, and the game of chips is not just about how many you have.
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