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The Sources of East Asia’s Industrial Prowess

A corporate structure that plays to the strengths of both family ownership and professional management, together with the vision to seize opportunities as they arise, has enabled firms from a small East Asian country to become major – and reliable – global players. This is good news for the West.

SEOUL – As the United States works to limit China’s access to advanced technologies like semiconductors, it cannot ignore its own dependence on small Asian economies like South Korea and Taiwan for many of those same technologies. The question the US and its allies must ask, then, is how reliable these economies are as producers.

Examining South Korea’s industrial successes can go a long way toward providing an answer. It is by now old news that the Korean giant Samsung Electronics has surpassed Japan’s Toshiba and America’s Intel to become the world’s top chip producer (by revenue). But South Korean industry’s prowess extends well beyond semiconductors.

For example, Hyundai Motors recently became the world’s third-largest carmaker, after Toyota and Volkswagen – with quality to match. Hyundai and its sister company Kia took the top spots in this year’s J.D. Power Vehicle Dependability Study, beating Toyota and General Motors. And in both 2022 and 2023, the World Car Awards named Hyundai’s electric vehicle (EV), the Ioniq, “world car of the year.”