South Korea makes huge investments in AI and chips

by Alimat Aliyeva

South Korea has unveiled an ambitious plan to invest $650 billion in artificial intelligence data center infrastructure by 2035, reinforcing its goal of becoming one of the world's leading AI and semiconductor hubs, AzerNEWS reports.

The announcement was made by Science and ICT Minister Bae Kyung-hoon during a presentation of major national investment projects attended by President Lee Jae-myung.

According to Bae, expanding high-performance computing infrastructure and securing vast amounts of data will be critical for South Korea to gain a competitive edge in the rapidly evolving field of physical AI—artificial intelligence designed to interact with and operate in the real world through robots, autonomous systems, and smart devices.

"The next three years will be a golden opportunity for South Korea to become a global leader in physical AI. The government will treat this sector as a national strategic industry and actively support its development," Bae said.

The government plans to invest 550 trillion won in the first phase, building AI data centers with a combined capacity of 8.4 gigawatts (GW) by 2029. The infrastructure will then be expanded by an additional 10 GW by 2035, creating one of the world's largest AI computing networks.

President Lee Jae-myung said the country is at a critical turning point, with growing global competition in both the semiconductor and artificial intelligence industries driving the need for bold investments.

As part of the broader strategy, South Korea's technology giants Samsung Electronics and SK Hynix (through SK Group) have announced a record 800 trillion won (approximately $519 billion) investment plan. Both companies will build two advanced semiconductor fabrication plants in the country's southwest, while the government will invest up to 81 trillion won in a new semiconductor packaging cluster near Seoul.

An interesting fact: AI data centers require enormous amounts of electricity to power advanced chips and cooling systems. Once completed, South Korea's planned AI infrastructure could rank among the largest in the world, placing the country in direct competition with the United States and China in the global race for AI leadership.