MUMBAI: Silicon is set to become South Korea’s newest power play. Betting big on the technologies expected to define the next industrial era, the country has unveiled an ambitious 1,350 trillion won (about $880 billion) investment roadmap centred on semiconductors, artificial intelligence and next-generation data centres.
Announcing the strategy on Monday, President Lee Jae Myung described semiconductors, physical AI and AI data centres as the three pillars of South Korea’s future industrial growth. In a televised address, he said the country must outpace global rivals in securing the technologies that will shape the AI economy.
At the heart of the plan is an 800 trillion won investment by Samsung Electronics, SK Hynix and their suppliers to build two semiconductor fabrication plants each in South Korea’s southwest. Industry Minister Kim Jung Kwan said the government also expects 81 trillion won to be invested in a semiconductor packaging cluster in the Chungcheong region near Seoul. To support the expansion, Gwangju and South Jeolla province will contribute between 5 trillion won and 20 trillion won, with Lee citing the region’s untapped power resources as a key reason for locating the chip facilities there. The move is also intended to spread industrial development beyond the Seoul metropolitan area.
The government is simultaneously ramping up AI infrastructure. Companies including SK Group, GS Group and Naver will invest 550 trillion won to develop AI data centres with a combined capacity of 8.4 gigawatts by 2029.
Science Minister Bae Kyung Hoon said the country also plans to add a 10-gigawatt AI data centre by 2035, taking total planned investment in AI data centres to more than 1,000 trillion won.
The government said the broader roadmap is designed to reinforce South Korea’s leadership in semiconductors and artificial intelligence while promoting balanced regional economic growth. However, the proposal has sparked political debate, with opposition parties questioning the decision to build another semiconductor cluster in the southwest, arguing that regional considerations rather than commercial logic influenced the choice. Critics also claimed memory chipmakers were being encouraged to invest in locations they may not have otherwise selected.
Lee dismissed those concerns, maintaining that the strategy balances regional development with the country’s long-term industrial priorities, while positioning South Korea to meet rising global demand for AI-driven technologies.