South Korea pledges $1.2T for chips and AI data centers

South Korea has unveiled an ambitious national investment plan totaling nearly $1.2 trillion, with a major emphasis on semiconductors and artificial intelligence data centers. Over $576 billion of that sum is specifically allocated to semiconductor manufacturing, a move designed to secure the country's dominance in the global chip market. The plan is anchored by South Korea's two largest chipmakers, Samsung Electronics and SK Hynix, which will lead the construction of new fabrication facilities and advanced packaging lines.

This investment comes at a critical time when global demand for AI-capable chips is surging and geopolitical tensions are prompting nations to build self-reliant semiconductor supply chains. The plan also includes funding for large-scale AI data centers to support the growing computational needs of generative AI and other advanced applications. By combining chip production and AI infrastructure investments, South Korea aims to create a vertically integrated tech ecosystem that can compete with the United States, China, and Taiwan. The government will also offer tax incentives and streamline regulations to accelerate private sector participation.