South Korean President Lee Jae Myung proposed 21.3 trillion won ($16 billion) for artificial intelligence and semiconductors in 2027, nearly twice this year’s funding, AFP reported after his Monday budget address to lawmakers.
AFP reported that the allocation includes data-center and robotics projects. Lee assigned 4.7 trillion won to frontier AI development, with the goal of producing a domestic model capable of world-leading performance. He described the model as a national strategic asset.
The government aims to increase defense spending about 8% from this year, to 73.3 trillion won, and to secure nuclear-powered submarines and KF-21 fighter jets, AFP reported. Lee said AI, robots and drones would be integrated across crewed and uncrewed forces as part of a military overhaul. He described the intended force as “smart” and “elite.” Seoul announced a submarine agreement with Washington last year; Pyongyang criticized the program, AFP reported.
The full proposal totals 821 trillion won, a record and a 12.8% increase from this year, according to AFP. Parliament must approve it. AFP said passage is likely because Lee’s party holds a majority. EconoTimes previously covered the proposed 2027 budget, which was then reported at 820.9 trillion won.
Samsung Electronics and SK hynix are major players in South Korea’s memory-chip industry; AFP described them as two of the world’s three largest producers. The AI buildout has tightened global memory-chip supply as profits and share prices rise at South Korean chipmakers. Engineers and other workers at Samsung and SK hynix have also sought higher pay in tense negotiations, AFP reported.
Lee said 2.1 trillion won would fund electricity, water and industrial-complex infrastructure, citing chip plants’ need for continuous, reliable power. AFP linked the chipmakers’ gains to demand for AI infrastructure and the resulting pressure on memory-chip supply.
