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The move comes in response to countries like the US, China, and Japan, each of which is investing heavily in their domestic semiconductor industry
The South Korean President Yoon Suk Yeol announced this week that the country will invest 9.4 trillion won ($6.94 billion) in artificial intelligence (AI) by 2027 in an effort to maintain a leading global position in the semiconductor chips industry.
The announcement also included a separate 1.4 trillion won ($1.01 billion) to support domestic AI semiconductor firms.
“Current competition in semiconductors is an industrial war and an all-out war between nations,” said Yoon in a speech.
“To set up an all-out response system that rises to the level of that for a wartime situation, we will review all proposals to attract semiconductor industries starting with investment incentives,” he continued.
“We will rise to the level of a G3 (world’s top three) country in AI technology and get over 10% of the global market for system semiconductors by 2030.”
Semiconductors are a key element of South Korea’s economy. In March, chip exports reached their highest revenue in 21 months at $11.7 billion, which is almost a fifth of all total exports.
The country is under increasing pressure to keep up with key global players such as the US, China, and Japan. Each of these nation’s is providing large incentives to semiconductor companies, seeking to increase their domestic production and reduce reliance on the geopolitically fraught global market. On Monday, for example, the US government announced that it has signed a preliminary agreement to award Taiwan Semiconductor Manufacturing Co (TSMC) a subsidy of $6.6 billion to build new chip production fabs in Arizona.
The South Korean government is not the only part of the country focussed heavily on the rapid development of AI. The country’s largest telco, South Korea Telecom (SKT) also shares the country’s vision on becoming a global leader in the field. The operator has confirmed its intention to become an AI powerhouse, investing in multiple AI firms including Anthropic and Persona AI.
SKT is also working with other global telcos to further its AI ambitions. Last July, the company joined forces with a trio of international telco giants – e&, Deutsche Telecom, and Singtel – to form the Global Telco AI Alliance, seeking to combine their collective AI expertise to help co-develop new, innovative products for telco customers.
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