South Korea Pledges Over $1 Trillion for AI and Chip Expansion

South Korea moved to lock in its position at the center of the global AI supply chain by announcing a coordinated national push exceeding 1,000 trillion won in semiconductors, data centers and physical AI infrastructure.

The centerpiece is an 800 trillion won corporate commitment from Samsung Electronics and SK Hynix to construct four new memory-chip fabrication plants in the southwestern provinces of Gwangju and South Jeolla. Industry Minister Kim Jung-kwan said the projects form the first of three linked initiatives that also include an 81 trillion won packaging cluster in the Chungcheong region and a 550 trillion won build-out of AI data centers reaching 8.4 gigawatts by 2029 and an additional 10 gigawatts by 2035. Science Minister Bae Kyung-hoon described the next three years as a “golden time” to lead in physical AI.

President Lee Jae Myung framed the effort as essential to outpace rivals, telling a televised audience that the country must “establish the core building blocks of artificial intelligence faster than any other country.” Government officials said they will accelerate permitting by as much as 12 years and supply power and water infrastructure to support the expansion.

Opposition lawmakers immediately questioned the choice of the southwest, noting that the region delivered 85 percent of its vote to Lee in the previous election and arguing that commercial logic favors expanding existing clusters near Seoul. Lee rejected the charge in weekend social-media posts.

Samsung shares fell 4.8 percent and SK Hynix shares fell 1.6 percent on the day of the announcement. Construction timelines remain unspecified; SK Hynix previously required nine years to complete its current Gyeonggi Province cluster. Officials did not detail how the announced figures overlap with a separate 1,000 trillion won Samsung investment blueprint reported earlier by Maeil Business Newspaper.