Changes in the Competitive Environment and Division of Labor Structure in Northeast Asia: A Focus on the Iron and Steel Industry

The purpose of this article is to examine the ideal ways in which the intraregional division of labor can overcome the current difficult business environment and strategic challenges to survive in the future. Analysis has shown that the iron and steel industries of the Republic of Korea, Japan, and China have developed through “competition and cooperation” with each other, but various development patterns and supply–demand structures have been created among these countries. Therefore, intraindustry trade and the intraregional division of labor have been formed and developed in Northeast Asia. The Japanese and Korean iron and steel industries have an export-oriented production structure. The high international competitiveness of both countries is caused by a high technological development capability and the optimization of the global value chain. Meanwhile, as the main factor in the international competitiveness of China, many small and medium-sized steel manufacturers have enhanced the productivity of low-priced products by specializing in specific production processes and specific products. However, the steel industry of the three countries has been facing severe trade and competition issues, such as increasing protectionism and trade frictions and a slowdown in global demand. The three countries should strengthen the intraindustry trade and specialization system.