South Korea's government announced on Monday that the private sector, led by tech giants including Samsung Electronics, SK Hynix, and Naver, will invest at least 1,350 trillion won over the next decade into chip manufacturing and AI data centers.
This colossal investment, equivalent to roughly 5% of the country's projected 2024 GDP, is being described by financial analysts as the start of a massive investment era.
The strategy is built upon three core pillars: semiconductors, physical AI, and AI data centers.
President Lee Myung-bak praised the heads of Samsung and SK Hynix as national heroes in a briefing, emphasizing that speed is the only path to survival in this competitive landscape.
Within the semiconductor segment, the Samsung Group and SK Group each plan to construct two new chip fabrication plants in the country's southwestern region, with a combined investment of approximately 800 trillion won aimed at rapidly expanding production capacity to meet soaring AI demand.
The national goal is to double memory chip production capacity within five years and accelerate the mass production schedule for the Yongin semiconductor cluster by seven to twelve years.
Samsung Electronics disclosed its own plan to invest 245.5 trillion won between 2026 and 2040, with 210 trillion won dedicated to the semiconductor sector, including the construction of a new manufacturing hub in Gwangju.
Meanwhile, the SK Group outlined a medium- to long-term investment roadmap totaling 210 trillion won, of which 110 trillion won is allocated for expanding memory chip production.
Beyond semiconductors, internet conglomerates such as Naver will invest around 550 trillion won to establish 8.4 gigawatts of AI data center capacity by 2029, with plans to add a further 10 gigawatts by 2035.
Despite the unprecedented scale of this expansion plan, analysts from JPMorgan note that the multi-year timeline from construction to full production means AI-driven shortages of memory chips are unlikely to ease in the foreseeable future, a situation already contributing to price increases for products like Apple's MacBook and Microsoft's Xbox.
Critics have also raised questions, pointing out that the government's detailed plans for securing the necessary electricity and water resources to support these facilities remain insufficiently clear.
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