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| Samsung Electronics Vice Chairman Lee Jae-yong answers reporters' questions at the Seoul Central District Court, Aug. 13. Korea Times file |
By Lee Kyung-min
Pardoned Samsung Electronics Vice Chairman Lee Jae-yong, who has pledged to make "a significant contribution to the Korean economy," is highly likely to become chairman of the chip giant soon, a long overdue promotion that will test his leadership to steer the company through an increasingly uncertain business environment, according to industry watchers Sunday.
Lee, the heir of the nation's largest conglomerate, has reiterated his commitment to continued investments, job creation and economic growth, a slew of goals he said he is grateful to achieve as a responsible entrepreneur. Lee made the comments Friday after being granted a special presidential pardon on the occasion of Aug. 15 Liberation Day.
Chief among his business initiatives will be fostering Korea's semiconductor industry, the country's key growth driver under mounting pressure to carefully calibrate national interests in the midst of fierce global competition and the U.S.-China hegemony war.
Closely tied to the performance of the high-tech industry is a much-awaited recovery of Samsung Electronics' share price, which currently hovers at around 60,000 won ($46), a sharp drop from 96,800 won on Jan. 15, 2021.
Equally important is how Lee will use the firm's cash reserve worth up to 124 trillion won to acquire other companies and secure new growth engines, including artificial intelligence, next-generation telecommunication services, bio and health businesses.
Whether and how well Lee powers through and makes strides amid the extreme uncertainties from within the country and abroad could mitigate lingering legal risks from an ongoing trial over alleged wrongdoings involving the merger of Samsung Group's construction and fashion affiliates, as well as accounting fraud at Samsung BioLogics, its biotech affiliate, in the process.
Lee's promotion to chairman is a due course of action, unless protested by minority shareholders, according to an industry official. "It remains to be seen how things will play out in the months to come."
Chips, acquisitions
The vice chairman is expected to fortify Samsung's non-memory chip-making capacity, a move to expand market presence as supported and accelerated by the chipmaker's lead in the global memory chip market over the past three decades.
Samsung's expansion efforts are fueled in large part by the rapid growth of Chinese rivals with the full backing of Beijing and insatiable demand from the immense market there.
Complicating the drive is Chip 4, a U.S.-led semiconductor supply chain alliance that can keep China at bay for a while at the expense of strained Korea-China diplomatic relations, possibly triggering Beijing to impose import curbs on Korean goods and anti-Korea sentiment in China. The remaining three chipmaking powerhouses are Korea, Taiwan and Japan.
China led an anti-Korea campaign in 2016 and 2017 in retaliation against Korea's decision to deploy a U.S. Terminal High Altitude Missile Defense (THAAD) system. China banned its people from visiting Korea and also the broadcast of Korean cultural contents, leading to what some state think tanks said cost Korea 15 trillion won in lost revenues in the tourism industry.
Also drawing keen market attention is the resumption of stalled acquisition talks. Samsung's last acquisition involved the U.S. auto electronics parts maker Harman for 9.4 trillion won in November 2016. Top Samsung Electronics executives have since hinted that another major corporate acquisition will be ub store, but no tangible progress has been made.
Lee's promotion to chairman is likely to take place before the end of this year, putting an end to his 10-year vice chairmanship that began in December 2012.
Lee is the only chief of the country's top four conglomerates, including Hyundai, SK and Lotte, without the title of chairman.
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