South Korea has unveiled one of the largest industrial investment packages in its history, committing 800 trillion won (approximately US$518 billion) to build a new semiconductor production hub in the country's southwestern regions and expand its artificial intelligence infrastructure. The announcement was made on Monday at Cheong Wa Dae — the presidential office in Seoul, formerly known as the Blue House — by Industry Minister Kim Jung-kwan, at a national investment briefing chaired by President Lee Jae Myung.
The centrepiece of the plan is the development of four new memory chip fabrication plants in the Gwangju and Jeolla regions, a comparatively underdeveloped part of southwestern South Korea known as the Honam region. The initiative is designed to create a second major semiconductor cluster to complement the existing hub in the greater Seoul metropolitan area, addressing longstanding regional economic imbalances. South Korea's chip giants Samsung Electronics and SK hynix — two of the world's leading producers of memory semiconductors — are central to the plan, with their respective chairmen attending Monday's briefing alongside other electronics industry executives.
The semiconductor investment is one strand of a broader government initiative dubbed the "three mega projects," which also covers physical artificial intelligence and AI data centres. The government highlighted that global investment in AI data centres is projected to reach around US$5.5 trillion by 2030, and said it aims to ensure that large-scale infrastructure spending translates into domestic industrial growth and competitiveness. The new package significantly surpasses previous landmark announcements: Samsung Group pledged 450 trillion won and Hyundai Motor Group 125 trillion won in separate five-year plans announced in November.
President Lee described the investment as a "historic achievement" with the potential to "change the fate of South Korea." The initiative is being jointly driven by the trade, science, transport and energy ministries. However, the opposition People Power Party has questioned the timing, arguing the move is politically motivated given an ongoing internal power struggle within Lee's ruling Democratic Party.
The scale of the commitment underscores South Korea's strategic bet on semiconductors and AI as the twin engines of its future economic growth, at a moment when global competition for chip manufacturing capacity — particularly from the United States, China, and the European Union — is intensifying rapidly.