In October 2022, the United States implemented its most stringent semiconductor export control measures to date, and in October 2023, these measures were further expanded. These controls primarily target two facets of the Chinese semiconductor industry: chip manufacturing and the use of AI chips in data centers. Regarding chip manufacturing, the U.S. seeks to limit China's ability to manufacture chips by controlling the export of semiconductor manufacturing equipment (SME). After the export control, there was a severe decline in SME imports in regions dominated by Chinese firms (Beijing, Shanghai, Anhui, and Hubei) and multinational corporations (Shaanxi, Liaoning, Jiangsu, and Fujian). Korea, which produces SMEs that complement U.S. SMEs, experienced a notable decline in SME exports to China across all regions. In the area of AI chips, the BIS has brought AI chips' under regulatory oversight and expanded the scope of AI chips under control, bringing almost all existing data center AI chips under export control. Data centers and major tech firms in China will likely face challenges meeting their requirements for developing large-scale AI models. On the other hand, the restrictions in the AI chips market are poised to have a ripple effect, negatively impacting the demand for high bandwidth memory (HBM). In response to these challenges, China is forced to turn to domestically manufactured chips and will heavily invest in supporting domestic chip designers to create alternatives to U.S.-sourced AI chips. Challenges and opportunities brought about by the semiconductor export control pose several implications for Korea. (1) Export controls present opportunities by easing the intense competition with China in semiconductor design and production, and capitalizing on this momentum is important. (2) The U.S. commitment to a multilateral export control regime would bring challenges to the Korean SME industry. Despite the negative impact on Korea’s SME industry in the Chinese SME market, engaging in a multilateral export control regime would facilitate information exchange and bolster Korea’s role in shaping export control regulations. (3) To strengthen the semiconductor supply chain, Korea must proactively seek and cultivate potential substitutes for semiconductor fabs in China that lack Extreme Ultraviolet (EUV) tools that limit their capability to produce 1a generation and advanced DRAM chips. (4) Strengthening the upstream segment of the value chain requires a significant focus on enhancing support for the SME industry in Korea. Developing SMEs with marketable offerings that can outperform their Chinese counterparts is essential.