What does it take for a country with little semiconductor experience to become a global industry leader? South Korea’s transformation offers lessons in sustained investment, technological innovation, and global cooperation, particularly as AI reshapes the semiconductor landscape.

At a recent seminar hosted by the Korea Program at Stanford’s Walter H. Shorenstein Asia-Pacific Research Center (APARC), C.S. Park, former chairman and CEO of Hynix Semiconductor (now SK hynix), traced the sector’s evolution from 1983 to the AI era. Drawing on more than four decades of experience, he examined the decisions and collaborators that propelled Korea to global prominence.

His overarching message underscored that Korea’s success was made possible by taking risks, investing in people, and persevering through difficult times. The next generation of semiconductor frontrunners will need that same determination, along with a willingness to learn from and work with associates worldwide.

Sign up for APARC newsletters to receive analysis and commentary by our experts and guest speakers >

Bet on Long-Term Potential, Not Short-Term Market Conditions

Park began in 1983, when Korea’s semiconductor ambitions were little more than a bold plan surrounded by rice paddies. Samsung, Hyundai, and LG entered the capital-intensive dynamic random-access memory (DRAM) business, despite limited expertise and warnings from established Japanese manufacturers.

Hyundai worked with companies such as Texas Instruments to gain manufacturing expertise and train Korean engineers. Following the Asian Financial Crisis, Park led efforts to restructure Hyundai Electronics into Hynix Semiconductor, divesting its non-memory products and rejecting Micron’s acquisition proposal in 2001 to preserve Hynix and Korea’s wider memory business.

For Park, the lesson is that technological oversight depends on lasting commitment, even when markets are unfavorable.

Build Technological Leadership Around Customer Needs

Park identified high-bandwidth memory (HBM), which stacks DRAM chips to enable the high-speed processing required by AI accelerators, as central to Korea’s semiconductor competitive advantage.

Initially considered costly and commercially uncertain, HBM became essential to AI computing. SK hynix’s early bet, backed by international partnerships, helped establish its leading position.

While market shares vary by reporting period and methodology, Park estimated that Samsung and SK hynix together accounted for around 83% of global HBM market share and 66% of DRAM during the period referenced in his presentation, illustrating Korean manufacturers’ importance to the AI supply chain.

He maintained that HBM demonstrates a broader shift toward system-level innovation as traditional improvements in transistor density become increasingly difficult. Leadership now depends less on producing chips at the lowest cost than on improving customers’ overall system performance.

Recognize the Opportunities and Limitations of the AI Super-Cycle

The memory industry has historically experienced boom-and-bust cycles driven by supply-demand mismatches. Because building fabrication facilities takes years, manufacturers cannot easily adjust capacity to changing market conditions.

Park suggested that AI could smooth out these fluctuations. Unlike previous phases, driven primarily by PC and smartphone sales, AI infrastructure requires significant memory, prompting major technology companies to seek supply arrangements that promise greater certainty.

Nevertheless, he cautioned against assuming the AI-driven super-cycle will continue indefinitely. If HBM becomes standardized or customers find ways to reduce memory needs, supply-demand imbalances could return. AI may make demand more resilient, Park argued, but will not eliminate cyclicality.

Strengthen Global Partnerships Rather Than Pursue Self-Sufficiency

Park emphasized that no company or country can independently produce all the technologies and materials required for superior semiconductors. The global value chain spans U.S. chip design, Dutch lithography equipment, Japanese materials, Taiwanese foundries and packaging, and Korean memory production. This interdependence has enabled Korea’s HBM achievements but also exposes the field to geopolitical tensions and trade disruptions.

Regarding the US, Park suggested that new DRAM fabrication facilities may be too costly and time-consuming to address immediate shortages. Expanding existing Korean facilities could be more practical in the near term, while U.S. investments in advanced packaging and research offer longer-term benefits.

He also highlighted China’s growing capabilities, particularly Yangtze Memory Technologies Corp. (YMTC) in NAND flash memory and ChangXin Memory Technologies (CXMT) in DRAM. While Chinese manufacturers still face technological challenges, he stressed their growing proficiencies, domestic market, talent pool, and industrial policy. This progress reinforces the importance of Korean innovation and international cooperation.

Invest in Talent to Sustain Korea’s Leadership

Park warned that Korea’s dependence on semiconductors has and will continue to create economic and social challenges. Samsung and SK hynix account for a substantial share of the country’s exports and stock market capitalization, making economic performance increasingly sensitive to industry fluctuations.

He also pointed to the widening income gap between semiconductor workers and those in other sectors. On the bright side, the sector’s triumph has reinvigorated interest in science, engineering, and education in semiconductors among high-achieving students.

Looking forward, Park urged Korean manufacturers to broaden their global talent pools, embrace emerging technologies, and strengthen international research ventures. He encouraged companies to support joint development initiatives with overseas institutions and businesses, even when commercial outcomes remain uncertain.

Returning to the rice paddies where his story began, Park concluded that Korea’s semiconductor success was built not on capital or government support alone, but on people: engineers who worked alongside customers and partners and persisted through trying conditions.

As AI continues to reshape the global semiconductor landscape, talent, collaboration, and long-term commitment will remain crucial to South Korea’s next chapter.