Korea's 'great leap forward'
South Korea laid out the largest industrial investment plan in its history on June 29, with President Lee Jae Myung announcing over $576 billion in spending to lock in global dominance in AI and semiconductor technology. Flanked by Samsung Electronics Chairman Lee Jae-yong and SK Group Chairman Chey Tae-won, Lee cast the initiative as a 'great leap forward' built on three pillars: semiconductors, physical AI, and data centers.
Four new fabrication sites
The centerpiece of the plan involves Samsung and SK Hynix investing 800 trillion won ($517.87 billion) — together with suppliers — to build two new chip fabrication plants each in South Korea's southwestern region. An additional 5-20 trillion won will come from the city of Gwangju and South Jeolla province, with a further 81 trillion won expected for a chip packaging cluster in the Chungcheong area near Seoul. The investment aims to revive regional economies beyond the capital area.
Global chip race intensifies
The announcement comes as competition for AI chip supremacy heats up between the US, China, and South Korea. Washington has pushed for more domestic chip production through the CHIPS Act, while Beijing pours state funding into domestic semiconductor self-sufficiency. South Korea's move positions its memory chip giants at the center of the AI hardware supply chain, which increasingly requires specialized high-bandwidth memory chips for training large language models.