The Global Nuclear Power Market Also Divided by Blocs... Korea, US, and Japan Counter China and Russia with SMR Cooperation

The decision by Korea, the United States, and Japan to jointly enter the global Small Modular Reactor (SMR) market is seen as a move to counter China and Russia, which currently have the upper hand in the global nuclear power market. The global nuclear industry is increasingly being divided into blocs led by major powers.

The foreign ministers of Korea, the United States, and Japan signed a Memorandum of Cooperation (MOC) to establish a trilateral cooperation framework to accelerate the deployment of Small Modular Reactors (SMRs) at the foreign ministers' meeting held on June 7 in Ankara, Turkey, on the sidelines of the NATO summit. From the right are Foreign Minister Cho Hyun, U.S. Secretary of State Marco Rubio, and Japanese Foreign Minister Toshimitsu Motegi. Provided by the Ministry of Foreign Affairs

An official from the Ministry of Foreign Affairs told reporters at the Government Complex Seoul on July 13, "The United States’ advanced source technology and the world-class manufacturing and construction capabilities of Korea and Japan are regarded as highly complementary," adding, "At the government level, the three countries have also begun discussions on cooperation measures to maximize synergies among companies from Korea, the US, and Japan."

According to the Ministry of Foreign Affairs, the three countries have been in related discussions since the middle of last year. It appears that the talks began at the initiative of the United States, which holds a technological lead. After about a year of behind-the-scenes discussions, on July 7, during the foreign ministers' meeting held on the sidelines of the NATO summit, the three ministers signed a Memorandum of Cooperation (MOC).

The purpose of this MOC is to establish a government-level framework that enables the nuclear industries of Korea, the US, and Japan to jointly enter the global SMR market, starting with the Indo-Pacific region. The three governments have agreed to promote cooperation among companies on SMRs and to jointly identify countries considering the adoption of SMRs, supporting their decision-making processes regarding nuclear power implementation. Cooperation will also include support for financing and capacity building in export destination countries, as well as assistance with technology, fuel, equipment, and services.

This cooperation is also seen as an attempt by the three countries to complement their respective weaknesses and enhance trust in their "joint brand." Since nuclear power is a strategic industry that requires long-term involvement not only in design and construction but also in fuel supply, operation, and decommissioning, factors such as safety, supply stability, and intergovernmental trust—as well as price—affect competitiveness in winning contracts.

The United States has unparalleled competitiveness in SMR design, core technology, and intellectual property rights, but construction of new nuclear plants has been suspended for a long time since the Three Mile Island accident in 1979. Japan's nuclear supply chain and overseas business base have also been weakened since the Fukushima accident in 2011.

In contrast, Korea has accumulated experience in nuclear plant construction for about 40 years since the completion of the Kori-1 reactor in the late 1970s. The Barakah nuclear power plant in the United Arab Emirates is cited as an example of a project completed on schedule and within budget, despite high desert temperatures and logistics disruptions caused by COVID-19. The official explained that "Korea’s capability in manufacturing nuclear equipment, such as heat exchangers and turbines, can also form a pillar of this cooperation," highlighting Korea’s strengths in the manufacturing sector.

This cooperation is also aimed at countering Russia and China, which have secured strong influence in the global nuclear market by leveraging price competitiveness and other advantages. Russia’s state-owned nuclear company Rosatom is known to dominate a large share of the overseas nuclear market through vertical integration that covers the entire nuclear and fuel cycle—from design, financing, construction, operation, and decommissioning to uranium mining, enrichment, and spent fuel treatment. Its practice of directly owning and operating power plants, thereby reducing the initial investment burden, and its price competitiveness are considered major strengths.

China is currently constructing a significant portion of the world’s nuclear plants domestically and has established an industrial base capable of sourcing over 90% of its nuclear supply chain within the country. By continuously building nuclear plants, China is rapidly accumulating construction and operational experience, which could further increase its influence in the global market over the long term.

In terms of price competitiveness alone, Russia and China lead the market. However, nuclear power is a strategic industry that requires long-term collaboration—often spanning around 100 years—from construction to operation and decommissioning. Safety, supply stability, non-proliferation standards, public acceptance, and intergovernmental trust all play a role, and the three countries aim to combine their strengths to compensate with enhanced safety and project execution capabilities. In this context, the MOC among the three countries appears to have been initiated by the United States.

Furthermore, the three countries intend to leverage their joint brand, combining technological and manufacturing/construction capabilities, to enhance this competitiveness and present a viable alternative in emerging markets such as the Indo-Pacific. The Ministry of Foreign Affairs official stated, "The Indo-Pacific region is expected to see the largest increase in new nuclear power demand in the future," adding, "If the capabilities of Korea, the US, and Japan are combined, we expect to offer a competitive alternative to countries in the region. In fact, following the signing of the MOC, we have already received positive reactions through various diplomatic channels."

However, this MOC is not based on any specific company or project. The official explained, "Nuclear power cooperation is fundamentally driven by companies based on economic viability and commercial value," emphasizing, "This MOC is also focused on establishing a government-level foundation to support the activities of companies."

This content was produced with the assistance of AI translation services.