South Korean President Lee Jae-myung on Monday unveiled a 750 trillion won ($576 billion) investment package aimed at cementing the country's dominance in AI chips and semiconductor manufacturing, the largest national AI commitment announced by any country to date.
Industry-government partnership
The plan, branded the 'AI National Initiative,' pools government funds from the newly created Public Growth Fund with private investment from Samsung Electronics and SK Hynix. The government will provide tax breaks, R&D subsidies, and fast-track permits for new fabrication plants. Samsung committed to building two new advanced chip fabs by 2028.
Focus areas
The investment targets high-bandwidth memory chips used in AI data centers, next-generation neural processing units, and a national AI computing infrastructure. South Korea currently produces over 60% of the world's memory chips but faces growing competition from US and Chinese rivals.
Global context
The announcement comes as the US, EU, Japan, and China all race to subsidize domestic chip production. The AI boom has driven memory chip prices to record highs, with Micron recently surpassing Meta in market valuation. South Korea's chip exports rose 35% year-on-year in May, reaching $12.1 billion.