Huawei ban will have both positive and negative effects on Korean firms: Experts
- 5 years ago
미국 정부의 화웨이 봉쇄...한국 기업 영향은?
Chinese tech giant Huawei is not backing down, in its fight against American restrictions.
The big question is how will this conflict affect South Korean businesses.
Ko Roon-hee provides a closer look.
Since the Trump administration added Huawei and its affiliates to a trade blacklist, countries around the globe, including South Korea, are bracing for the ripple effects.
Although industry sources say large conglomerates like Samsung Electronics and SK hynix aren't planning to immediately cut ties with Huawei, analysts predict there will be an impact in the long run.
As Washington aims to cut Huawei and it affiliates out of the global market, Korean firms that provide parts for the Chinese companies' finished products are likely to be hit.
One of Seoul's main export destinations is China...with the percentage of total shipments marking more than 26-percent of 2018's total.
Breaking it down by major firms, Samsung Electronics' sales in China in 2018 accounted for more than 17-percent of its total.
For SK hynix, it was 47-percent in the first quarter of this year.
An expert in the field provided specific numbers.
"Huawei announced earlier that it purchased more than 10-billion U.S. dollars worth of parts in Korea last year. And according to Samsung Electronics' quarterly report, Huawei is one of the main customers of the Korean firm. For instance, Huawei accounts for 3-percent of total chip sales."
However, the outlook for the smartphone industry appears brighter.
Samsung Electronics accounted for more than 19-percent of the global market share in the 1st quarter of this year,...
while Huawei came in second, with around 15-percent.
"Just looking at the smartphone industry, I think there might be some benefits for Korean firms. There are other competitors as well, but Samsung's global market share might increase a little due to the Huawei ban."
To prepare for the upcoming changes, experts suggest the diversification of export destinations.
But coming up with competitive products is more important... to create demand from countries other than China.
Ko Roon-hee, Arirang News.
Chinese tech giant Huawei is not backing down, in its fight against American restrictions.
The big question is how will this conflict affect South Korean businesses.
Ko Roon-hee provides a closer look.
Since the Trump administration added Huawei and its affiliates to a trade blacklist, countries around the globe, including South Korea, are bracing for the ripple effects.
Although industry sources say large conglomerates like Samsung Electronics and SK hynix aren't planning to immediately cut ties with Huawei, analysts predict there will be an impact in the long run.
As Washington aims to cut Huawei and it affiliates out of the global market, Korean firms that provide parts for the Chinese companies' finished products are likely to be hit.
One of Seoul's main export destinations is China...with the percentage of total shipments marking more than 26-percent of 2018's total.
Breaking it down by major firms, Samsung Electronics' sales in China in 2018 accounted for more than 17-percent of its total.
For SK hynix, it was 47-percent in the first quarter of this year.
An expert in the field provided specific numbers.
"Huawei announced earlier that it purchased more than 10-billion U.S. dollars worth of parts in Korea last year. And according to Samsung Electronics' quarterly report, Huawei is one of the main customers of the Korean firm. For instance, Huawei accounts for 3-percent of total chip sales."
However, the outlook for the smartphone industry appears brighter.
Samsung Electronics accounted for more than 19-percent of the global market share in the 1st quarter of this year,...
while Huawei came in second, with around 15-percent.
"Just looking at the smartphone industry, I think there might be some benefits for Korean firms. There are other competitors as well, but Samsung's global market share might increase a little due to the Huawei ban."
To prepare for the upcoming changes, experts suggest the diversification of export destinations.
But coming up with competitive products is more important... to create demand from countries other than China.
Ko Roon-hee, Arirang News.