South Korean PM endorses presidential pardon of Samsung chief Lee Jaeyong

Some prominent South Korean politicians have endorsed a presidential pardon of Samsung’s chief Lee Jaeyong. They cite the company’s critical role in South Korea’s economy as well as its growing challenges in the semiconductor market. The public supports favorable outcomes.

Lee is currently serving a sentence in a case involving bribery. He is responsible for Samsung Electronics’ long-term and medium-term investment strategies. Due to restrictions, Lee is not able to participate fully in company operations.

Although Lee’s prison term ended in July 2022, he is subject to a five-year employment restriction. Lee can only be fully restored to control by a presidential pardon.

Prime Minister Han Duck-soo said on July 27 that he would recommend to President Yoon Suk-yeol a pardon for Lee and other key business leaders when asked in parliament, according to local reports.

Han previously stated to local media that the Korean people would approve of pardoning top business executives, such as Lee and Lotte, but not against their will.

A recent South Korean poll showed that 77 percent of respondents supported the pardon of Lee, according to Korea JoongAng Daily.

The poll was jointly conducted by four local polling agencies which surveyed 1,006 adults nationwide between July 25 to 27.

The data revealed that both conservative and liberal respondents were strongly in favor of Lee’s pardon. Liberals responded with 69 percent in favor and 30 percent against, while conservatives responded with 88 percent in favor and 10 percent against.

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Many South Korean media believe that Lee will win.

The pardon is widely expected to be issued on Aug. 15, the nation’s Independence Day, when they traditionally occur. Yoon is currently considering his first pardon. Many believe it will allow Lee and other key business leaders amnesty.

President Joe Biden (left) and South Korean President Yoon Suk-youl (center) and Samsung Electronics Co. Vice Chairman Lee Jae-yong (right) during their visit to the Samsung Electronic Pyeongtaek Campus in Pyeongtaek on May 20, 2022. (Kim Min-Hee/AFP via Getty Images)

Semiconductor Industry

Yon, since his election, has emphasized the vitality of the country’s semiconductor industry. It is crucial to national security as well as core industries.

Although Yoon declined to comment on the question of Lee’s pardon, a representative from the presidential administration offered some insight.

“Is it not difficult for the economy right now? They are individuals who could contribute to the economy and it is possible that they will receive amnesty. According to Yonhap News Agency, the pardons aren’t limited to certain businesspeople.

Man in Charge

Lee was convicted of bribery and embezzlement charges and spent 18 months in prison and was paroled in August last year. In his role as vice-chairman of Samsung Electronics (one of the largest manufacturers of smartphone memory chips and computer memory chips in the world), Lee now heads the Samsung Group.

He was convicted of bribing then-President Park Geun-hye and her close confidante, who are serving lengthier prison terms, to win government support for a 2015 merger between two Samsung affiliates that tightened his control over the corporate empire.

Lee Jae-yong, Samsung Group heir arrives at Seoul Central District Court to hear the bribery scandal verdict in Seoul, South Korea, on Aug. 25, 2017. (Chung Sung-Jun/Getty Images)

Samsung Electronics showed no signs of financial trouble, while Lee managed the company behind bars and communicated his decisions via visiting executives. As millions fled the country due to pandemic, demand has risen for their TVs and semiconductor chips.

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There were also concerns about Lee’s imprisonment slowing down Samsung’s ability to make major investments, when the company needed to invest aggressively in order to remain competitive in semiconductors.

While Samsung is still the market leader in memory chips there are concerns that Samsung may be losing ground to rival Taiwan Semiconductor Manufacturing Co., (TSMC), in the race for higher-tech chips with a wider range of functions.

The demand for high-end chips will grow quickly in the future, driven by 5G wireless, artificial intelligence and self-driving vehicles. Analysts suggest Samsung could become more aggressive in seeking merger and acquisition agreements to acquire such technologies, once Lee is fully engaged in its business and can sign off more readily on investments.

U.S. President Joe Biden shakes hands with Samsung Electronics Co. Vice Chairman Lee Jae-yong after a press conference at the Samsung Electronic Pyeongtaek Campus in Pyeongtaek on May 20, 2022. (Kim Min-hee/Pool/AFP via Getty Images)

US Efforts to Decouple from China

South Korea, as a major semiconductor producer, was recently invited to join the U.S.-led Chip Alliance. This alliance aims to separate countries from China and puts the country in an important strategic quandary.

The U.S.-led Chip 4 alliance seeks to increase cooperation between the United States, East Asian powerhouses Taiwan and South Korea and Japan in semiconductor production. This will help to create a safe supply chain without China.

South Korea has China as its largest trading partner, unlike Japan and Taiwan. South Korean exports to China accounted for 25.3 percent of its exports through 2021, about 10 percent higher than the United States.

Despite China’s increasing pressure, experts and the public believe that South Korea is most likely to join the proposed alliance for chip technology.

On July 26, the U.S. Senate voted to advance its Chips and Science Bill aimed at boosting domestic semiconductor production and improving technological competitiveness with China.

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At the U.S.-South Korea summit last week, Biden and Yoon committed to strengthening semiconductor alliances between the largest chip-making nations in the world to reduce global shortages.

As part the economic partnership, South Korea officially announced its participation in the U.S-led Indo-Pacific Economic Framework. This framework outlines the United States’ top priorities for aligning with allies and partners in order to be more effective with China in the global race to develop and standardize technology.

Reuters contributed to this report.

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Lisa Bian, a writer based in Korea for The Epoch Times, focuses on Korean society and culture as well as international relations.

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