South Korea adds $6.5 billion in research funding to reduce dependence on Japanese imports

According to Reuters, South Korea announced on Monday that it plans to invest about 7.8 trillion won ($6.88 billion) in research and development in the next seven years to promote local production of materials and equipment, thereby reducing its dependence on Japanese imports.

Japan removed South Korea from the “white list” of trade preferences last Friday. South Korean President Wen Zaiqi held an emergency cabinet meeting on the 2nd, criticizing Japan’s move: "Japan’s rejection of diplomatic efforts to solve the problem is a very reckless act that has further aggravated the situation." Said: "Deep regret." He also pointed out that in October last year, the compulsory labor lawsuit of the Second World War in the South Korean Supreme Court ruled that Japanese companies must compensate, and the measures taken by Japan today are "clear economic retaliation."

In July of this year, Japan tightened its export control of several raw materials needed to make chips in South Korea. This move in Japan may disrupt the global semiconductor supply chain of technology giants such as Apple and Huawei.

South Korea plans to increase the “self-sufficiency” level of 100 key components, materials and equipment to stabilize the supply for the next five years. These key components, materials and equipment are used to make chips, displays, batteries, automobiles and other products.

The South Korean government said in a statement that the plan aims to "solve structural weaknesses in the Korean materials, components and equipment industries. These weaknesses are that these industries are heavily dependent on specific countries."

In this 51-page statement, South Korea also proposed a series of measures to boost domestic supply, including financing for overseas acquisitions of more than 2.5 trillion won.