Korea-Japan Technology Relations

The Weight of History: From Colonial Legacy to Trade War

The technology relationship between South Korea and Japan is inseparable from the broader historical relationship between the two nations. Japan's colonial occupation of Korea from 1910 to 1945 created deep-seated resentment that continues to shape public sentiment, diplomatic relations, and economic policy more than eight decades later. This historical burden makes the Korea-Japan technology relationship fundamentally different from other bilateral technology partnerships. Every initiative toward cooperation must navigate domestic political sensitivities in both countries, where technology policy can become entangled with unresolved questions of historical justice, compensation, and national pride.

The most consequential recent manifestation of this dynamic was Japan's imposition of export controls on three critical semiconductor materials in July 2019: photoresists, hydrogen fluoride, and fluorinated polyimides. These materials are essential inputs for semiconductor fabrication, and Japan controlled dominant shares of global production for each. The export restrictions, widely interpreted as economic retaliation for Korean Supreme Court rulings ordering Japanese companies to compensate forced labourers during the colonial period, sent shockwaves through the Korean semiconductor industry and the broader global chip supply chain.

The 2019 crisis catalysed a fundamental reassessment within Korean industry and government. Samsung Electronics, SK Hynix, and other Korean semiconductor manufacturers accelerated efforts to diversify their semiconductor materials supply chains away from Japanese sources. The Korean government launched emergency R&D programmes to develop domestic production capabilities for the restricted materials. By 2021, Korea had achieved significant progress in reducing its dependency on Japanese hydrogen fluoride and had qualified alternative photoresist suppliers, though Japan remained the dominant source for the most advanced extreme ultraviolet (EUV) photoresists.

Complementary Strengths: The Logic of Cooperation

Despite the historical tensions, the technology ecosystems of Korea and Japan are profoundly complementary. This complementarity creates powerful economic incentives for cooperation that, over the long term, may override the political forces pulling the two nations apart.

Japan's Upstream Dominance

Japan retains commanding positions in several critical upstream segments of the semiconductor supply chain. Japanese companies produce approximately 50 percent of the world's advanced photoresists (used to pattern circuit designs onto silicon wafers), with JSR, Tokyo Ohka Kogyo, and Shin-Etsu Chemical as the leading suppliers. Japan's semiconductor equipment industry, anchored by Tokyo Electron (the world's third-largest equipment maker), Screen Holdings, Canon (lithography), and Disco (wafer grinding and dicing), holds roughly 30 percent of the global semiconductor equipment market by revenue.

Japan also dominates the production of high-purity silicon wafers through Shin-Etsu Chemical and SUMCO, which together account for more than 50 percent of global 300mm wafer production. These wafers are the fundamental substrate upon which every advanced semiconductor is fabricated, making Japan's wafer industry an essential enabler of Korean chip manufacturing.

Korea's Downstream Dominance

Korea's semiconductor strength lies in downstream manufacturing, particularly memory and advanced logic fabrication. Samsung and SK Hynix's combined dominance in DRAM and NAND flash memory is unmatched globally. In High Bandwidth Memory (HBM), the critical enabling technology for AI accelerator systems, Korean companies hold more than 90 percent of global production capacity. Samsung Foundry, while trailing TSMC, remains the world's second-largest contract chipmaker with advanced gate-all-around (GAA) process technology at the 3nm node and below.

This upstream-downstream complementarity means that Korean and Japanese semiconductor industries are deeply interdependent. Korean fabs cannot operate without Japanese materials and equipment. Japanese materials and equipment companies depend on Korean fabs for a substantial share of their revenue. This mutual dependency creates a structural floor beneath the bilateral technology relationship, even during periods of political tension.

The Post-2023 Rapprochement

The March 2023 summit between Korean President Yoon Suk Yeol and Japanese Prime Minister Fumio Kishida marked a significant diplomatic rapprochement that extended into the technology domain. The summit, which addressed the forced labour compensation dispute through a Korean government-funded solution, removed the immediate political obstacle that had precipitated the 2019 export controls. Japan subsequently lifted the enhanced export control measures on semiconductor materials, restoring Korea to its preferential trade partner status.

Since the rapprochement, bilateral technology cooperation has expanded across multiple fronts. Korean and Japanese semiconductor companies have explored joint R&D initiatives in next-generation chip packaging, compound semiconductors, and advanced materials. The two governments have established working groups on supply chain resilience, critical mineral sourcing, and AI governance. Cultural and educational exchanges in STEM fields have been revitalised after years of decline.

However, the rapprochement remains fragile. Domestic opposition in Korea to the forced labour compensation arrangement continues, and political transitions in either country could disrupt the diplomatic progress. The technology cooperation initiatives lack the institutional depth and binding commitments that characterise the Korea-US semiconductor alliance, making them vulnerable to political headwinds.

Semiconductor Cooperation: Emerging Initiatives

Several specific semiconductor cooperation initiatives between Korea and Japan merit attention for their implications for K-Moonshot and the broader regional technology landscape.

Advanced Packaging Collaboration

Korean and Japanese companies are exploring collaboration in advanced semiconductor packaging, the manufacturing process that combines multiple chip dies into integrated packages. This area has become strategically critical as AI chips increasingly require heterogeneous integration of logic, memory, and interconnect components. Korea's leadership in HBM production and Japan's strength in packaging materials (substrate laminates, bonding films, underfill materials) create natural complementarity. Joint R&D in chiplet architectures and 3D stacking technologies could strengthen both nations' positions against TSMC's advanced packaging capabilities.

Compound Semiconductor Development

Both nations are investing in compound semiconductors (gallium nitride, silicon carbide) for power electronics, RF communications, and photonics applications. Japan's Rohm, Mitsubishi Electric, and Fuji Electric hold established positions in silicon carbide power devices, while Korean companies including Samsung and SK are building compound semiconductor capabilities. Collaborative development could accelerate progress in this critical area for electric vehicles, renewable energy, and multi-junction solar modules (Mission 3).

The Rapidus Factor

Japan's Rapidus consortium, which aims to establish leading-edge 2nm logic chip manufacturing in Hokkaido by 2027, represents both a cooperative opportunity and a competitive challenge for Korea. Rapidus is backed by Japanese government subsidies exceeding 920 billion yen and has secured a technology licensing agreement with IBM for gate-all-around transistor architecture. If successful, Rapidus would give Japan advanced logic manufacturing capability for the first time in decades, potentially competing with Samsung Foundry for customers.

From Korea's perspective, Rapidus presents a complex strategic calculus. A successful Rapidus could reduce Samsung Foundry's market share in advanced logic. However, it could also strengthen the broader non-Chinese advanced semiconductor ecosystem, creating a more resilient supply chain that benefits Korean memory makers and Korean fabless chip designers like Rebellions and FuriosaAI who need diverse foundry options beyond TSMC.

AI and Digital Technology Cooperation

Beyond semiconductors, Korea-Japan technology cooperation is emerging in artificial intelligence, quantum computing, and digital infrastructure, all areas with direct relevance to K-Moonshot missions.

AI Research Exchanges

Korean and Japanese AI research institutions have deepened collaboration since 2023. KAIST, Seoul National University, and ETRI have established joint research programmes with the University of Tokyo, RIKEN, and Japan's National Institute of Advanced Industrial Science and Technology (AIST). These collaborations focus on areas including robotics, natural language processing for East Asian languages, and AI safety. The cooperation is particularly relevant to K-Moonshot Mission 7 (Physical AI Models), where Japan's world-class robotics research community represents a valuable complementary resource.

Quantum Computing

Japan's quantum computing programme, centred on RIKEN's superconducting quantum computer and Fujitsu's quantum-classical hybrid systems, offers potential synergies with Korea's Mission 12 (Quantum Computers). Both nations face the challenge of competing against vastly larger US and Chinese quantum programmes, and collaboration in specific areas such as quantum error correction algorithms and cryogenic engineering could yield mutual benefits. SK Telecom's quantum subsidiary and NTT's quantum research division have explored technical exchanges, though these remain at an early stage.

Robotics Synergies

Korea and Japan are the world's two most robotised economies by robot density (robots per 10,000 manufacturing workers), giving both nations deep institutional expertise in robotic systems. Japan's robotics industry, led by Fanuc, Yaskawa, and Kawasaki, has traditionally focused on industrial automation, while Korea's robotics ecosystem, including Hyundai/Boston Dynamics, Doosan Robotics, and Rainbow Robotics, has been more oriented toward service robots and humanoids. Complementary cooperation in humanoid robot development (Mission 6) could strengthen both nations' positions against the rapidly growing Chinese robotics ecosystem.

Critical Mineral Cooperation

Both Korea and Japan face critical mineral supply chain vulnerabilities, particularly dependency on China for rare earth elements, lithium processing, and specialised semiconductor materials. This shared vulnerability creates an obvious basis for cooperation in supply chain diversification.

Japan's JOGMEC (Japan Organization for Metals and Energy Security) and Korea's KOMIR (Korea Mine Rehabilitation and Mineral Resources Corporation) have established frameworks for joint mineral exploration and procurement. Both nations are investing in deep-sea mining technologies, with Japan's exploration of polymetallic nodules in the Pacific and Korea's Mission 9 (Rare Earth Elements) encompassing similar deep-ocean mineral extraction technologies. Joint development of rare earth recycling technologies, where Japan's Shin-Etsu Chemical and Hitachi Metals hold advanced capabilities, could accelerate Korea's progress toward reduced China dependency.

Structural Barriers to Deeper Cooperation

Despite the economic logic and recent diplomatic progress, several structural barriers continue to constrain Korea-Japan technology cooperation.

Historical Sensitivity and Public Opinion

Public opinion in both countries remains wary of deep technology partnership. Korean public surveys consistently show low trust in Japan as a technology partner, with memories of the 2019 export controls reinforcing perceptions that Japan will use technology leverage as a political weapon. Japanese public opinion, while generally more neutral, harbours concerns about technology transfer to a commercial competitor. These sentiments constrain the political space available to leaders in both countries for pursuing bold cooperation initiatives.

Commercial Competition

Korean and Japanese companies are direct competitors in multiple technology segments beyond semiconductors, including displays (Samsung/LG vs. Japan Display/Sharp), automotive electronics (Hyundai vs. Toyota/Honda), batteries (LG Energy Solution/Samsung SDI/SK On vs. Panasonic), and consumer electronics. This commercial rivalry makes technology sharing inherently difficult, as cooperative R&D in one domain could yield competitive advantages that spill over into contested market segments.

Asymmetric Alliance Structures

Both Korea and Japan are US security treaty allies, but their alliance relationships with Washington are structured differently and serve different strategic purposes. The US-Japan alliance has a broader security scope (including nuclear umbrella and force projection), while the US-Korea alliance is more narrowly focused on the Korean Peninsula. In the technology domain, Japan's participation in the US-Japan-Netherlands semiconductor equipment export control arrangement gives Tokyo a direct role in shaping the export control regime that affects Korean chipmakers' China operations. This asymmetry creates tensions, as Korea sometimes perceives itself as subject to technology governance decisions in which it has limited voice.

Implications for K-Moonshot

The Korea-Japan technology relationship has multifaceted implications for K-Moonshot's execution. On the supply chain side, Korea's continued access to Japanese semiconductor materials, equipment, and wafers is essential for the advanced chip manufacturing that underpins Mission 11 (AI Accelerator Chips) and the broader sovereign AI infrastructure build-out. Any disruption to this access, whether from renewed political tensions or from Japan prioritising domestic fab build-out over export supply, would directly constrain K-Moonshot's semiconductor ambitions.

On the cooperative side, the emerging R&D partnerships in quantum computing, robotics, and critical minerals offer K-Moonshot missions access to complementary Japanese expertise that could accelerate technical progress. Japan's deep strengths in materials science, precision manufacturing, and fundamental physics research align well with K-Moonshot's research-intensive missions, including fusion energy (Mission 4), quantum computing (Mission 12), and advanced materials.

The strategic imperative for both nations is clear. In an era of intensifying Chinese technology competition and shifting export control regimes, Korea and Japan share fundamental interests in maintaining the technological frontier in advanced semiconductors, AI, and deep tech. Whether the two nations can translate this shared interest into sustained, institutional cooperation, despite the weight of history and the pull of commercial rivalry, remains one of the open questions in the Indo-Pacific technology landscape. For K-Moonshot, the answer will materially affect the programme's capacity to achieve its most ambitious technical objectives.