Where Korean chips go: Greater China took 54 per cent as Taiwan stood still

Korea exported $32.72bn of integrated circuits in July 2026. China took $13.42bn of that and Hong Kong $4.37bn, or 54.4 per cent between them, against 41.4 per cent in the same month a year earlier. Taiwan took $3.90bn, which is 11.9 per cent, down from 27.9 per cent. Taiwan did not buy less. It bought 13.7 per cent more, in a market that grew 166 per cent.

Taiwan grew 13.7 per cent while the total grew 166 per cent

The three destinations moved at three speeds, and the gap between them is wider than any of the individual moves.

Source: Korea Customs Service, HS 8542. Own calculation.

In July 2025 China and Taiwan were close to equal customers, 29.3 per cent against 27.9 per cent. Thirteen months later one is three and a half times the other. Nothing in the Taiwan column deteriorated to produce that; the entire reordering is a difference in growth rates.

Hong Kong is a separate case and should not be read as final demand. Korean chips entering Hong Kong are overwhelmingly in transit, a pattern set out in the reading of the Hong Kong route. Its 13.4 per cent belongs with China’s 41.0 per cent for most purposes, which is why the two are summed here and why the sum, not either part, is the number worth quoting.

The traffic is also close to one-way, and became more so. Korea sent $4.37bn of integrated circuits to Hong Kong in July 2026 and received $34.4m back, a ratio of 127 to 1. A year earlier the ratio was 29 to 1, because the import leg actually shrank over the thirteen months while the export leg tripled. China, by contrast, sells back in volume: Korean imports from China multiplied by 2.05 to $3.55bn. A destination that buys but does not sell is behaving like a port rather than a market.

The one direction Taiwan did move

Taiwan is the only one of the three where Korean imports grew faster than Korean exports. Imports from Taiwan multiplied by 1.47 against exports at 1.14, and the bilateral surplus in July 2026 was $0.58bn against $1.17bn a year earlier.

That looks like a convergence, and the temptation is to call it one: memory flowing out, logic flowing back, the two trades approaching balance. The monthly series does not support the claim. Across the thirteen months the Taiwan balance runs from $0.58bn to $3.20bn, and the $3.20bn was June 2026, the month immediately before the low. A series that swings by a factor of five from one month to the next cannot be read for a trend at a sample of twelve, and February 2026 is missing from it.

What survives is narrower and firmer: Taiwan is the destination where the two directions of trade are closest in size, and it is the only one of the three where the import side is growing faster. Whether that becomes convergence is a question for more months, not for this one.

What to watch

Whether Taiwan’s share stabilises near 12 per cent or continues to fall. A share can decline for two quite different reasons, and only one of them is visible in a percentage: a destination that stops growing, and a destination that shrinks. Taiwan has so far done the first and never the second, and the month it does the second would be the first genuine change in this table.

Alongside it, whether the concentration in Greater China holds above half. The combined share passed 50 per cent during 2026 and the level itself is now the thing being tracked, since a single policy change at either end would land on 54 per cent of the export book rather than on 41 per cent of it.