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| Samsung Display's headquarters in Asan, South Chungcheong Province / Courtesy of Samsung Display |
By Baek Byung-yeul
The incoming Yoon Suk-yeol administration is expected to introduce measures to help local companies in displays, semiconductors and other high-tech industries maintain their competitive edge over rapidly growing Chinese rivals, according to company officials Tuesday.
The transition committee of President-elect Yoon Suk-yeol called in officials from display companies, such as Samsung Display and LG Display, and academic experts last weekend to gather opinions on the rapid rise of the Chinese display industry, according to the officials.
"The committee member met with officials from the display industry and academia to learn about the industry's current situation," an official from a local display firm said on condition of anonymity.
The transition committee is said to have listened to industry opinions on ways to widen the technology gap to overcome China's pursuit and started an internal review. The move is in line with the incoming president's vision to create more jobs in high-tech industry sectors.
On the national strategy to find future the growth engines of the country, Ahn Cheol-soo, chairman of the presidential transition committee, said on April 25, "We will focus on discovering and fostering new and growing future industries as well as the big three ― semiconductors, cars and bio health that currently make a lot of money," adding that the new items will be displays, small modular reactors, defense and culture.
Experts said the reason the display sector is being treated as one of the industries to solidify its position is that China outpaced Korea's display industry for the first time in 2021.
The display industry has grown to the second-largest core item of Korea following semiconductors, as the industry accounted for 4.4 percent of Korea's GDP last year. However, according to the local display industry, China had the largest market share by country based on 2021 sales, accounting for 41.5 percent while Korea had only 33.2 percent. This was the first time in 17 years since 2004 that Korea had not topped the market.
"It has already been about four years since Chinese companies outpaced Korean companies in the LCD sector, which can be manufactured at a much cheaper price. Although Korean companies have been putting most of their focus on OLEDs, which is more recent technology than LCD, China is increasing its shares gradually in this field as well," said Kim Hyun-suk, senior general manager at Korea Display Industry Association.
"Currently, Chinese companies are trying to increase their market share by mainly making medium- to low-priced products, while Korean companies are leading premium products such as curved displays and low-power-consuming displays. It is true that Korean companies are showing overwhelmingly higher technological capabilities compared to Chinese companies," the official said.
In order to maintain the technology gap with China, the government needs to provide tax support to help companies further expand investments in facilities and research and development, according to a committee comprised of officials from the display industry, academia and research institutions.
"In the face of strong pursuit by competitors, Korean companies with the world's best technologies can widen the gap with competitors through commercialization of advanced technologies," Korea Display Industry Association Vice Chairman Lee Dong-wook said, Tuesday.
The association held a meeting of its display development strategy consultative body at a hotel in Seoul and maintained that the display industry should be included in the special law on high-tech strategic industries to expand industrial competitiveness to compete with China.
"We need expanded tax credit supports from the government to revitalize investment in the private sector and foster high-quality human resources," the vice chairman said.
