Semiconductors are South Korea’s second-largest export item to the United States, and exports have been rising rapidly in line with the recent artificial intelligence (AI) boom. If the United States actually imposes additional tariffs on imported semiconductors, significant damage is expected for South Korea as well.

According to the Ministry of Trade, Industry and Energy on the 15th, South Korea’s exports to the United States last year totaled USD 122.87 billion (about KRW 180.2 trillion), down 3.8% from a year earlier. This decline is attributed to the imposition of U.S.-origin tariffs following the inauguration of U.S. President Donald Trump, which has reduced exports of Korean products to the U.S. market.

However, semiconductors alone drove an increase in exports to the United States and helped narrow the overall decline. Last year, South Korea’s semiconductor exports to the United States reached USD 13.37 billion (about KRW 19.6 trillion), a 30.0% increase in just one year. Semiconductors rank as the second-largest item among all Korean exports to the U.S. This contrasts with automobiles, the top export item (USD 29.59 billion), and general machinery, the third-largest (USD 12.32 billion), which declined by 13.5% and 17.2%, respectively.

If semiconductor volumes shipped via Taiwan to the United States are also taken into account, South Korea’s effective semiconductor export volume to the U.S. becomes even larger. Currently, global AI semiconductors are produced under a division of labor in which Taiwan’s foundry (contract manufacturing) company TSMC fabricates products designed by U.S. firm Nvidia. Samsung Electronics and SK hynix mainly export high bandwidth memory (HBM) to Taiwan’s TSMC. This is why many Korean-made semiconductors shipped to Taiwan ultimately have the United States as their final destination.

South Korea primarily exports HBM to Taiwan, and the United States imports completed Nvidia AI chips from Taiwan. For this reason, even if the United States imposes tariffs on Nvidia chips, there is no direct impact on Korean semiconductor companies. Only indirect effects, such as increased price burdens, are anticipated. However, if Taiwan’s TSMC agrees to complete high-performance semiconductors such as Nvidia chips at its facilities in the United States, Korean companies may need to export HBM directly to the U.S. In that case, they would fall more squarely within the scope of U.S.-origin tariffs, raising the likelihood that HBM will need to be manufactured in the United States in practical terms.

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