South Korea expects its semiconductor boom to run through at least 2027 as global demand outpaces production, Finance Minister Lee Hyoung-Il said in Bangkok.

A persistent imbalance between hardware orders and factory output keeps the export cycle expanding across the region.

Speaking on the sidelines of the IMF-World Bank meetings, Lee noted that production capacity is broadening while orders remain heavy. The minister confirmed that stronger corporate returns from device fabricators will lift South Korea’s total tax collections above earlier fiscal targets for the current year, providing cushion against broader economic drag.

Equity markets told a more conflicted story during the week. Shares in South Korean component makers including SK Hynix and Seoul Semiconductor dropped sharply, matching pullbacks at US tech giant Nvidia.

Traders dumped technology holdings because of interest rate concerns and direct pressure from Chinese semiconductor competitors. That market swing weighed heavily on Seoul’s headline benchmarks, where electronics manufacturers account for a dominant share of trading volume compared with rival Asian bourses.

Hardware suppliers in Asia face a widening gap between short-term equity pricing and actual factory shipments. Consumer electronics assemblers, server operators, and device vendors still order stock faster than fabrication lines can deliver it, limiting downside risk for upstream producers over the next two years.

The principal threat to sustained margins sits later in the investment cycle. Analysts and domestic industry commentators warn that massive capex across global foundries could trigger severe component gluts by 2029.

Rapid factory construction across China and North America threatens to turn memory pricing into cut-throat competition once artificial intelligence hardware installations reach saturation.

Source link