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At Samsung's Seoul HQ
At Samsung's Seoul HQ
Lisa Lane

SEOUL — A recently retired senior manager from South Korean electronics giant Samsung is back to work — in China.

Referred to just by his last name, Kim, had been executive director responsible for electronic chip design (D-RAM) at the Seoul-based multinational. But just before he was set to begin his senior position at the Chinese enterprise, Kim received notice from a South Korean court that Samsung had filed a lawsuit against him for not abiding by a "non-compete" clause arrangement, Radio Free Asia reports.

Kim says that he is entitled by the Constitution to have the right of choosing his profession freely. The case awaits adjudication.

For industry veterans who possess core technology and management experience, the pay in China can go as high as eight times that of their South Korean job, an industry insider notes. As the world's largest smartphone and computer manufacturer, accounting for 60% of global semiconductor demand, China relies heavily on high-priced imported chips, mainly from the U.S., South Korea and Taiwan, with less than 15% produced at home.

People fear that South Korea's competitive edge could be eroded.

With its "Made in China 2025 Plan," China aims to raise its local capability to 50% in the next six years. According to H&L Management Consultants, a Taipei-based firm, China has funded the development of its semiconductor industry to the tune of over $22 billion since 2014, aiming to reduce its reliance on foreign-made chips. Hundreds of billions are expected to be invested over the next decade.

The reason why Kim's court case attracted South Korean public opinion is because semiconductors is the only sector where the country is still years ahead of China. People fear that South Korea's competitive edge could be eroded, after mobile phones, display panels, shipbuilding and the automobile industry have all been overtaken, one by one, by China.

According to Radio Free Asia, China has so far poached more than 1,000 talented individuals from South Korea. Previously, Taiwan, one of the world's top three chip makers countries, along with South Korea and the US, was China's favorite country to approach for chip talents, as the two countries share the same language.

According to Epoch Times, China lacks as many as 400,000 engineers for its chip-making ambitions. To fill in the gap quickly, and to avoid struggling through endeavors of research and development, not only is the country luring foreign talents with fat payment packages, it is also encouraging engineers to arrive with commercial secrets, such as design drawings. Among Taiwan's surging litigation cases related to technology theft in recent years, 90% come from Chinese companies.

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