South Korea to unveil $650 billion AI and chip mega-plan under President Lee

The scale of the announcement, if investments materialise at the reported $651 billion level over the coming years, represents a structural demand signal for the global semiconductor supply chain, advanced manufacturing equipment and AI infrastructure buildout. SK Hynix in particular warrants close attention given its pivotal role in high-bandwidth memory supply for AI accelerators; any confirmed capacity expansion in a new location adds long-term supply optionality but introduces near-term execution uncertainty that the market will need to price. Korean utility and infrastructure names are the immediate domestic read-through, given the government's commitment to cover power, water and land support. The political risk embedded in the southwest location deserves monitoring: a plan framed as national survival strategy but contested as regional favouritism carries the kind of domestic political volatility that can delay or reshape large infrastructure commitments, particularly in a country where industrial policy and electoral politics intersect closely.

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South Korea unveils three AI and chip mega-projects including a new southwest semiconductor hub, with investments potentially exceeding $650 billion. Samsung and SK chairmen are attending as President Lee frames the plan as a national survival strategy.

Earlier:

• active government coordination with both Samsung and SK Hynix on accelerated chip facility construction

Summary:

• President Lee Jae Myung will preside over a national "great leap" event unveiling three mega-projects spanning semiconductors, AI data centres and physical AI including robotics
• Local media report planned investments could exceed 1,000 trillion won ($651 billion) over coming years, with Samsung Electronics and SK expected to present investment plans
• A new chip cluster in the southwest, covering Gwangju and South Jeolla province, is the centrepiece, aimed at easing concentration of industry in the Seoul metropolitan area
• Samsung and SK Hynix, the world's two largest memory chipmakers and dominant producers of high-bandwidth memory chips critical to AI systems, already operate major facilities around Seoul
• Government support measures will cover power, water, land, infrastructure, workforce training and housing
• Lee rejected criticism the southwest hub favours a liberal political stronghold, calling it the most rational semiconductor expansion decision under full government support
• Industry experts warn that building cutting-edge fabs in a new region requires electricity, water, logistics, supplier networks and skilled labour that may not scale quickly enough to meet AI demand

South Korea is poised to announce one of the most ambitious industrial investment programmes in its history, with President Lee Jae Myung set to preside over a national "great leap" event unveiling three mega-projects that local media say could attract more than 1,000 trillion won, equivalent to $651 billion, in semiconductor, AI and robotics investment over coming years.

Reuters reported that Samsung Electronics and SK are expected to present investment plans at the event, with the chairmen of both conglomerates, Jay Y. Lee and Chey Tae-won, among business leaders tipped to attend alongside representatives from LG Electronics, HD Hyundai Robotics, Korea Electric Power Corp and Korea Water Resources Corp.

The centrepiece of the package is a new semiconductor hub planned for the southwest of the country, covering Gwangju and South Jeolla province, a region that has historically lagged the Seoul metropolitan area in industrial development. The move is designed to diversify chip capacity beyond the capital region, where Samsung and SK Hynix, the world's two largest memory chipmakers and dominant suppliers of the high-bandwidth memory chips powering global AI infrastructure, currently concentrate the bulk of their operations.

Lee spent the weekend defending the plan against criticism that it amounts to political favouritism toward a liberal stronghold, framing the southwest cluster instead as a national survival strategy to expand capacity for the AI era and correct long-standing regional imbalances.

Industry experts broadly support the diversification logic but flag execution risk. Cutting-edge semiconductor fabrication requires vast and reliable electricity and water supply, advanced logistics, deep supplier ecosystems and a concentration of highly skilled engineers, none of which can be assembled quickly in a greenfield location, raising questions about whether the new hub can scale fast enough to meet the pace of AI-driven demand.

This article was written by Eamonn Sheridan at investinglive.com.