South Korea announces more than $1 trillion AI, chip investment drive

Key Points:

• South Korea has announced a major industrial strategy focusing on semiconductor chips and AI, with President Lee Jae Myung pledging investments totaling hundreds of billions of dollars to secure global leadership in these sectors.
• Samsung Electronics and SK Hynix plan to invest 800 trillion won ($518 billion) to build new chip fabrication sites in South Korea’s southwest, supported by additional government and regional investments.
• The government aims to develop AI data centers with an investment of 550 trillion won ($356 billion) from major corporations, targeting the construction of a 10-gigawatt AI data center by 2035 with total investments exceeding 1,000 trillion won ($648 billion).
• The initiative focuses on revitalizing economies outside the Seoul metropolitan area, particularly in the southwestern region, but faces criticism from opposition parties accusing the government of political motivations in site selection rather than industrial logic.
• President Lee has defended the southwestern chip hub plan, emphasizing the region’s untapped power resources and rejecting claims that the decision was politically driven, despite the area being a stronghold of his party.