[Op-Ed] Counter the Trump Round with reform of inefficient systems and a market economy

Trump’s “America First” round, Brexit, and the EU carbon border tax — the global trade order is changing rapidly

Korean semiconductor firms face a double burden — external trade pressure and the outflow of domestic industrial investment, putting their global competitiveness at risk

For Korea’s semiconductor industry, labor regulation is the enemy within — while U.S.-based Nvidia and Taiwan’s TSMC compete through flexible labor policies

The second Trump administration has begun to drive the “Trump Round.” The “Trump Round” is an America First strategy aimed at reorganizing supply chains around the United States. Not only the “Trump Round,” but also Brexit and the EU carbon border tax show that the global trade order is rapidly changing into a form unlike anything seen over the past 30 years.

Direct and indirect threats to Korea’s export and industrial competitiveness are growing. In particular, Korean semiconductor firms, which account for a high share of exports, are facing a double burden of external trade pressure and the outflow of domestic industrial investment, putting them at risk of weakening global competitiveness.

The crisis in Korea’s semiconductor industry has already begun. Its share of the global semiconductor market peaked at about 24% in 2018, but fell to 13% in 2023 — a plunge to nearly half in just five years. In particular, its market share in the system semiconductor sector is only 3%, revealing a distorted structure that depends almost entirely on memory semiconductors.

Labor regulation is the enemy within, suppressing the development of the semiconductor industry. Advanced technologies such as AI semiconductors require intense, concentrated research over short periods, but rigid labor regulations fundamentally block this. Even when research is in full swing, the absurd situation keeps recurring in which researchers must leave in the middle of experiments because of legally mandated working-hour limits.

The gap with global competitors continues to widen. Engineers at America’s Nvidia and Taiwan’s TSMC devote themselves to technological development through labor systems that allow them to work intensively and flexibly. Nvidia developers in the United States voluntarily put in more than 80 hours a week. TSMC in Taiwan likewise completed a technological edge far beyond Samsung and Intel through its “Night Hawk” project, which operates research labs around the clock in three shifts.

Simple subsidies are not the answer. Rather than relying on short-term subsidy measures, the government should focus on fundamentally overhauling regulations to create an environment where it is easy to do business. The United States is drawing in global factories with unprecedented tax incentives. Korea, too, must become the easiest country in the world in which to do business. Only a decisive revision of rigid labor laws in line with the times can create the conditions for our semiconductor firms to continue producing innovative technologies at home.

Labor regulations must be boldly eased. It is urgent to introduce a “white-collar exemption” system that maximizes research immersion. Highly skilled, highly paid researchers should be allowed to manage their own working hours, giving them the flexibility not to interrupt the flow of research. This is not simply about making people work more, but an essential strategy for enabling them to fully exercise their creativity and maintain a global technological lead.

The vitality of private enterprise is the foundation of national survival. The government must actively identify and reform various regulations affecting advanced strategic industries such as AI and semiconductors. Rapid government support is needed for roads, transportation, energy, and other infrastructure to quickly build advanced system semiconductor cluster industrial complexes.

Crisis is opportunity. The rapid change in the global trade order represented by the Trump Round should serve as the occasion to reform Korea’s inefficient internal systems and restore the value of the market economy. The government should focus on diplomatic support and removing institutional barriers, while leaving international business decisions to companies that best understand conditions on the ground.

Hyunseok Kim, Intern Researcher, Center for Free Enterprise (CFE)

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Original title: [칼럼] 트럼프 라운드, 비효율적 시스템 개혁과 시장 경제로 맞서라

Author: Hyun-seok Kim

Date: 2026-07-23

Source: https://www.cfe.org/bbs/bbsDetail.php?cid=free_opinion&pn=1&idx=29306