Fueled by exports of artificial intelligence (AI) semiconductors, South Korea and Taiwan surpassed Japan in export value for the first time in the first half of this year.

On August 7, the Nihon Shimbun Shuppan (Nikkei) reported this analysis, based on trade statistics from South Korea, Japan, and Taiwan, as well as databases from the Japan External Trade Organization (JETRO) and United Nations trade statistics.

In the first half of this year, South Korea's exports reached $496.3 billion (approx. 702.7 trillion won) and Taiwan's reached $416.6 billion (approx. 590 trillion won), both increasing by more than 50% compared to the same period last year.

Conversely, Japan's exports during the same period stood at $384.4 billion (approx. 544 trillion won), posting a modest increase of around 10% and falling behind South Korea and Taiwan.

Experts analyze that the explosive expansion of demand for AI semiconductors lies behind this shift.

Advanced semiconductor producers such as Samsung Electronics and SK Hynix in South Korea, along with TSMC in Taiwan, drove the export growth.

In the first half of this year, integrated circuit exports reached $149 billion (approx. 211 trillion won) for South Korea and $133.2 billion (approx. 189 trillion won) for Taiwan, with integrated circuits accounting for roughly 30% of total exports in both economies.

In particular, South Korea's integrated circuit exports in the first half alone surpassed its entire annual performance from last year.

On the other hand, Japan's integrated circuit exports for the first half were limited to $21.2 billion (approx. 30 trillion won), making up only about 5% of its total exports.

Instead, Japan maintains strong competitiveness in semiconductor manufacturing equipment and materials, boasting a high global market share.

During the first half, Japan's exports of semiconductor manufacturing equipment reached $15 billion (approx. 21 trillion won), outpacing South Korea ($5.2 billion, approx. 7 trillion won) and Taiwan ($3.5 billion, approx. 5 trillion won).

However, semiconductor manufacturing equipment exports alone were not enough to close the gap with South Korea and Taiwan, which manufacture high-value-added advanced end-product semiconductors experiencing soaring global demand.

Some analysis suggests that the recent weak Japanese yen also contributed to reducing Japan's export figures when converted into U.S. dollars.

However, Nikkei explained that the South Korean won and the New Taiwan dollar have also weakened against the U.S. dollar, meaning exchange rates alone cannot fully explain the export gap between South Korea, Taiwan, and Japan.

Some also point out that this cannot be dismissed merely as a temporary phenomenon driven by the AI semiconductor boom.

Japan's export volume index (an index measuring changes in the quantity of exported goods excluding price fluctuations) peaked before the 2008 global financial crisis and has remained stagnant in recent years.

Nikkei noted, "South Korea and Taiwan reaped massive rewards by seizing the current trend where major tech companies are fiercely competing in advanced AI development at the stake of their survival. If Japan fails to draw a new growth model suited for the digital age, it risks falling further behind in both manufacturing and services."

(Photo: AP, Yonhap News)