Korean Manufacturing Faces 'Lost Decade'... 'AI' is Essential to Avoid Massive Exit, Warns Chey Tae-won

[Financial News] "Korean manufacturing has entered a 'lost decade.'"
Chey Tae-won, Chairman of SK and the Korea Chamber of Commerce and Industry, warned that "if we cannot revive manufacturing through artificial intelligence (AI), a significant portion of Korean manufacturing will be phased out in 10 years," diagnosing the current state of the Korean economy. He issued a strong warning that if the fierce pursuit of Chinese manufacturing is not stopped, Korean manufacturing will face a survival issue. 
Chairman Chey diagnosed at the press conference during the Korea Chamber of Commerce and Industry Summer Forum held in Gyeongju, Gyeongbuk on the 17th, "In the 2000s, Korean manufacturing enjoyed a boom due to exports to China, but now Chinese manufacturing has developed skills and is competing with almost everything we produce." Chairman Chey said, "In fact, many people, including myself, have been warning for 10 years that new industrial policies and strategies should be introduced, but unfortunately, the mindset of 'we are making money now' prevented acceptance." Chairman Chey stated, "During the 10 years we were stagnant, facilities aged," and "especially in petrochemicals, we are not even a competitor to the Middle East, India, or China, and to make matters worse, cheap Russian crude oil is flowing into China, so almost all companies in Korea could become deficit-ridden." Chairman Chey also commented on semiconductors, a pillar of the Korean economy, saying, "(Due to U.S. export controls, etc.) China had no choice but to develop semiconductors independently, and the Chinese government poured in enormous resources to survive, speeding up the chase," adding, "Now they are almost at the heels of Korean semiconductors."
Chairman Chey repeatedly mentioned the 'lack of strategy' in key domestic manufacturing sectors such as semiconductors, electronics, steel, and petrochemicals, emphasizing, "We have no choice but to pin our hopes on AI." He suggested that manufacturing production innovation through AI is necessary to respond to China's pursuit. He proposed strengthening cooperation with Japan through this. He said, "To excel in AI, we need to partner with Japan, which has a lot of data in the industrial manufacturing sector, and exchange data," suggesting that "a Korea-Japan economic community like the European Union (EU) could be a good option for us."
Chairman Chey also suggested to President Lee Jae-myung at the AI Global Business Meeting held in Ulsan last month on the 20th that "AI should be made a compulsory subject in universities." President Lee also responded, "AI compulsory education should be expanded to elementary, middle, and high schools."
Chairman Chey commented on the U.S. Trump administration's demand for the creation of a U.S. manufacturing support investment fund, saying, "It's a matter for the government to handle," but added, "There's no reason to get excited, and we need to respond calmly and understand the truth." Regarding the U.S. demand for expanded market opening for rice, beef, and other agricultural products, he said, "Although it's a sensitive political issue for farmers on both sides of the Pacific, the increase in the U.S. trade surplus that can be improved through this is too small to have a significant impact on the overall negotiations," but also noted, "If we use too many non-tariff barriers, there is a risk of retaliation, so a reasonable level of protective policy is needed."
Regarding the government's policy to create '100% renewable energy (RE100) industrial complexes,' he said, "Even the big tech companies that led RE100 in the past have now given up on RE100," adding, "There are many ways to achieve the goal of minimizing carbon emissions, so if we become too obsessed with 'RE100 or not,' it becomes strange." He argued for a decarbonization policy that considers energy prices that companies can afford. Regarding the legislative push for mandatory treasury stock cancellation, he said, "If you reduce corporate autonomy, it will be difficult to increase treasury stock purchases."
Chairman Chey referred to the confirmation of Samsung Electronics Chairman Lee Jae-yong's acquittal in the unfair merger and accounting fraud case, saying, "Personally, it's late but still fortunate."
Regarding his eldest son, Choi In-geun (30), who recently left SK Innovation E&S (SK E&S) and joined McKinsey & Company, he said, "I want him to live his life where his heart leads him," adding, "Since he said he wanted to, I said, 'Okay, then go.'" Regarding the public perception that it might be part of successor training, he said, "When raising children, it's 'free-range,'" adding, "They make their own judgments, I don't tell them what to do. I might say, 'How about this?' but if they say, 'I think this is more important,' I tell them to do that." 
ehcho@fnnews.com Eunhyo Cho