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Reuters

South Korea rolled out sweeping chip and AI megaprojects on Monday, as President Lee Jae Myung pledged to cement overwhelming industry leadership with investments worth more than US$576 billion over several years.
The announcement marks ⁠Lee’s boldest push yet to align South Korea’s AI and chip ambitions with ‌his pledge to narrow regional disparities and revive economies beyond the Seoul metropolitan area.
Lee was joined by the leaders of ‌Samsung Electronics and SK Hynix, the world’s two largest memory chipmakers, for ⁠the televised ⁠announcement.
“We must secure the core elements of AI faster than any other country,” the president ‌said. “Semiconductors, physical AI, and AI data centres are the triple axis for our great leap forward.”
We must secure the core elements of AI faster than any other country,
President Lee Jae Myung
Samsung and SK Hynix will invest 800 trillion won (US$518 billion) with suppliers to build two new chip fabrication sites each in South Korea’s southwest region, he said.
Lee said the country’s southwestern city of Gwangju and South Jeolla province will also invest 5 trillion to 20 trillion won in the projects, with a further 81 trillion won expected for a chip packaging cluster in the Chungcheong area near Seoul.
He said the southwest would host major chip production clusters, drawing on abundant, underused power.

“To meet ‌the rapidly increasing demand for semiconductors, we need to quickly complete the production hubs that are currently under construction,” he said. “At the same time, we must secure overwhelming production capacity in advance through large-scale new investments, including in the southwestern region. Existing sites ‌centred around Yongin and Pyeongtaek have already reached their limits.”
Representatives of other firms including LG Electronics, HD Hyundai Robotics, Korea Electric Power Corp ⁠and Korea Water Resources Corp also attended, ⁠Lee’s office said.
Chip defence
High-bandwidth memory chips produced by Samsung Electronics and SK Hynix have become pivotal in the global race to build advanced AI systems. Both companies already operate major semiconductor facilities ‌in and around the Seoul metropolitan area.
South Korean industry minister Kim Jung-kwan said at the event the country would double dynamic random-access memory (DRAM) output within five years by bringing forward construction of fabs in the Seoul ‌metropolitan area ‌to the mid-2030s.
DRAM is a type of memory that is used to power electronics such as laptops and smartphones and HBM is produced by stacking multiple layers of DRAM.
Lee defended the proposed southwest chip hub in a series of social media posts over the weekend, rejecting criticism that it favoured a liberal stronghold. He ⁠framed it instead as a “national survival strategy” to ease regional imbalances and expand capacity for the AI era.

“The creation of a semiconductor industrial ecosystem in [the ⁠southwest] is not a special favour for a particular region,” Lee wrote in one post. “It is the additional creation of the most rational semiconductor industrial centre through the decisions of relevant companies under full government support.”
Industry experts say diversifying chip investment beyond Seoul could ease infrastructure ‌bottlenecks, but warn that building cutting-edge fabs ‌requires vast electricity and water, advanced logistics, deep supplier networks and highly skilled labour – elements that may not scale quickly enough in a new region to meet surging AI demand.
Opposition politicians have sharply criticised the plan, questioning whether the proposal is politically motivated given that 85 per cent of voters in the region backed Lee in last year’s presidential election.
The announcement comes as Lee’s approval rating has slid for six weeks to 46.5 per cent, according to pollster Realmeter.


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Workers walk through Samsung Electronics’ chip production plant at Pyeongtaek, South Korea. Photo: Samsung Electronics/Reuters

South Korean President Lee Jae Myung (centre) views an observation satellite model ahead of a meeting with representatives of defence companies at the presidential office in Seoul on Friday. Photo: dpa

Kwak Noh-jung, chief executive officer of SK Hynix, checks out the company’s booth at Computex in Taipei, Taiwan, on June 2. Photo: Reuters

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Nvidia CEO Jensen Huang (centre) looks at a Boston Dynamics Spot robot at the Hyundai Motor Group headquarters in Seoul on Monday. Photo: Reuters

Nvidia CEO Jensen Huang (right) and Lee Hae-jin, founder of internet giant Naver, acknowledge visitors during their meeting at the Naver headquarters in Seongnam, south of Seoul, on Monday. Photo: Yonhap/EPA

Nvidia CEO Jensen Huang dines with SK Group chairman Chey Tae-won, LG Group chairman Koo Kwang-mo and Naver chairman Lee Hae-jin at Hyungnim Jeoyo, a pork belly barbecue restaurant in Hongdae, on Friday. Photo: The Korea Times

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Currency dealers celebrate in front of a screen showing South Korea’s benchmark stock index during a ceremony celebrating it breaking 7,000 points at the Hana Bank headquarters in Seoul on May 6. Photo: AFP

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The logo of Samsung Electronics is seen on a gate at the company’s headquarters in Suwon, South Korea, on May 22. Photo: AFP

SK Hynix is one of the world’s important suppliers of memory chips used in AI systems. Photo: Reuters

A PR track is demonstrated at the laboratory of the department of semiconductor engineering at Korea University in Seoul. Semiconductor exports have helped drive South Korea’s export growth earlier this year. Photo: Reuters

Residential buildings in downtown Seoul, South Korea. Economists note that only about 55 per cent of households in the Seoul metropolitan area own their homes. Photo: Shutterstock

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North Korean soldiers move along a fence line near Yujeong-dong village in North Korea, as seen from the Ganghwa Peace Observatory in Incheon in 2024. Photo: The Korea Times

South Korean President Lee Jae Myung receives a briefing at an observatory on Yeonpyeong Island, South Korea, near the maritime border with North Korea on Wednesday. Photo: Yonhap/AP

A sign located near the demilitarised zone at the central section of the inter-Korean border in Yeoncheon, north of Seoul, which says that the DMZ is under the jurisdiction of the US-led UN Command. Photo: EPA

A North Korean soldier stands at a watch tower next to a giant loudspeaker near the demilitarised zone in Paju in June last year. Photo: AFP

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Some South Korean investors are still looking to Hong Kong to invest in AI and semiconductors via ETFs despite Seoul's announcement on May 27 that it had lifted the single-stock leverage ban.  Photo: Sun Yeung

ETFs that track blue-chip semiconductor stocks Samsung Electronics and SK Hynix have proved popular with investors in South Korea. Photo: EPA

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This move is ⁠Lee’s boldest yet to align the nation’s tech ambitions with ‌his pledge to narrow regional disparities and revive economies


This move is ⁠Lee’s boldest yet to align the nation’s tech ambitions with ‌his pledge to narrow regional disparities and revive economies.


South Korea unveils US$576 billion megaprojects to dominate global AI, chip market

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}This move is ⁠Lee’s boldest yet to align the nation’s tech ambitions with ‌his pledge to narrow regional disparities and revive economies

This move is ⁠Lee’s boldest yet to align the nation’s tech ambitions with ‌his pledge to narrow regional disparities and revive economies