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South Korea pledges $16 billion for AI and semiconductors in record budget push
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AI Summary
South Korea's President Lee Jae Myung has proposed a record $16 billion investment in AI and chips to secure the nation's position as a global technological leader.
President Lee Jae Myung has announced a 21.3 trillion won ($15.97 billion) investment plan for artificial intelligence and semiconductors to bolster South Korea's global technological standing.
During an annual budget address to parliament on Monday, President Lee Jae Myung detailed plans to nearly double current spending on AI and key technology projects. According to Deutsche Welle, the 21.3 trillion won allocation will target semiconductors, physical AI, and AI data centers. Reuters reported that this funding is part of a broader record-breaking budget proposal aimed at maintaining the nation's competitive edge.
The administration intends to dedicate 4.7 trillion won specifically to frontier AI development. President Lee described the goal of these projects as achieving world-leading performance for a domestic AI model, which he categorized as a national strategic asset. This initiative comes as South Korea continues to rely on its strong chip manufacturing sector, led by companies like Samsung Electronics and SK Hynix.
The total proposed budget for the upcoming year reached 820.9 trillion won, representing a 12.8% increase in government spending. While the proposal requires parliamentary approval, Deutsche Welle noted that Lee's Democratic Party of Korea (DPK) currently holds the majority in the legislature.
The push for increased technology spending follows a period of faster-than-expected economic growth in the third quarter. This growth was largely supported by semiconductor exports and domestic investment. Export figures reached $930 billion between January and October, placing the country on a path to surpass $1 trillion in annual exports.
Background
South Korea is currently the fourth-largest economy in Asia and is home to major memory chip producers Samsung Electronics and SK Hynix. If it reaches $1 trillion in annual exports this year, it will become the fourth nation to do so after the United States, China, and Germany.
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