Tue, Jul 16, 2019 - Page 10 News List

Samsung gains lifeline as it navigates export curbs


Samsung Electronics Co has managed to secure an emergency supply of key materials to sustain its chipmaking operations for the time being, averting short-term disruption from a Japanese ban of critical semiconductor and display components.

That temporary lifeline did not represent a “fundamental solution,” a Samsung spokesman said yesterday, confirming a report by Yonhap news agency over the weekend.

Samsung vice chairman Jay Y. Lee had convened a meeting on Saturday with top management and asked them to prepare contingency plans, he added.

Lee ordered them to prepare for various scenarios, for instance should Japan remove Korea from its so-called “white-list” of nations not deemed to present a risk of weapons proliferation, the spokesman said.

South Korea’s largest company is grappling with a spat between Japan and South Korea that risks upending the global technology supply chain.

The Japanese government this month slapped export restrictions on three materials that, while little-known outside of the industry, are profoundly important for electronics production.

Samsung had less than a month’s worth of supply of the materials on average, people familiar with the matter told reporters last week.

Among the targeted materials is fluorinated polyimide, required for the production of flexible panels — such as those used in Samsung’s Galaxy Fold — among other things.

Photoresists are key to chipmaking, while hydrogen fluoride is needed for chip and display production.

It is unclear how much of each Samsung had secured, and the spokesman did not elaborate. Samsung has been scrambling to find alternatives and one of the ways is to secure materials from Japanese suppliers’ overseas plants.

Lee had visited Japan last week to meet senior officials from the country’s business sector.

Samsung’s emergency supplies were secured through the company’s efforts, separate from his trip, the spokesman added.

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