South Korea has confirmed plans to invest about 7.8 trillion won (US$6.5 billion) in supporting the country’s battery sector and other key domestic industries in a trade row with Japan.
South Korea said it would boost “self-sufficiency” for 100 key components, materials and equipment items such as semiconductors used in battery packs for electric vehicles— aiming to ease the country’s dependency on other nations.
The move was triggered by Japan’s removal of South Korea from a “white list” of countries with fast-track export status, which Seoul sees as retaliation after a court ordered Japanese corporations to compensate Koreans recognised as being forced to work for Japanese firms before and during the Second World War.
According to the materials and parts division of South Korea’s Ministry of Trade, Industry and Energy, there will be “intensive investment to secure urgent core technology”, including expanded R&D and an “evaluation” of proposals for the “mass production” of semiconductors.
Tokyo has said its actions are based on national security concerns.
However, South Korean president Moon Jae-in (pictured) told domestic industry leaders: “As a fundamental countermeasure, we have to take this as an opportunity to reduce our reliance on overseas sources by drastically raising the rate of localisation for the core technologies, key parts, materials and equipment needed by Korea’s mainstay industries.”
Earlier this month, South Korea reportedly broke ground on the country’s first recycling centre dedicated to breaking and recycling EV battery packs.