South Korea Nearly Doubles AI and Chip Spending in 2027

Quick Answer: South Korea will allocate 21.3 trillion won (US$16 billion) to semiconductors, physical AI, AI data centres and AI investment in 2027, nearly double this year’s amount. The figure sits inside a record 821 trillion won budget proposal, up 12.8% from this year. For shareholders of Samsung Electronics and SK hynix, the spending shows the government is betting heavily on the chip and AI supply chain.

How Much Is South Korea’s AI and Chip Spending in 2027?

South Korea AI and chip spending 2027 technology background — Technology and semiconductor demand is driving South Korea’s 2027 budget plan.

President Lee’s proposal groups semiconductors, physical AI and AI data centres into what he calls the “three mega-projects”. Together with broader AI investment, they share the 21.3 trillion won allocation.

A separate 4.7 trillion won will support “frontier AI development projects”. The stated aim is world-leading performance for South Korea’s own AI model, which Lee called “a national strategic asset”.

South Korea is a tech powerhouse, home to Samsung Electronics and SK hynix. The two are among the world’s three biggest makers of memory chips, components in heavy demand from the AI boom.

South Korea Nearly Doubles AI and Chip Spending in 2027 — Photo: Free Malaysia Today

What Did President Lee Say About the AI Push?

“We will make bold investments in AI and future growth engines to boost our economy’s growth potential, which is the foundation of its economic strength,” Lee said. The speech outlined his government’s spending plans for 2027.

Why Is the Defence Budget Rising 8.2% to 73.3 Trillion Won?

The government wants an 8.2% increase in defence spending from this year, to 73.3 trillion won. Its goals include securing nuclear-powered submarines and KF-21 fighter jets.

Lee also wants to “rapidly transform our military into a smart, elite force” using integrated manned and unmanned systems based on AI, robots and drones. That places AI and robotics spending in both the civilian and military budgets.

What Does the Record 821 Trillion Won Budget Mean?

The overall budget plan totals 821 trillion won, a 12.8% increase from this year. It is the largest budget proposal on record.

Parliament must still pass the proposal. Reports say approval is likely given Lee’s party majority.

Which Stocks Are Worth Monitoring From the 2027 AI Budget?

The report centres on two chip makers:

Samsung Electronics: one of the world’s three biggest memory chip makers.
SK hynix: the other Korean name in that top three group.

The report does not say how the 21.3 trillion won will flow to either company. It also names no Bursa Malaysia-listed company, so no Malaysian stock code is cited here. Investors wanting to track AI themes can read our AI Stock Analysis for Malaysians guide.

Key Takeaways

South Korea will allocate 21.3 trillion won (US$16 billion) to semiconductors, physical AI, AI data centres and AI investment in 2027.
The AI allocation is nearly double this year’s amount.
A further 4.7 trillion won targets frontier AI development projects.
The total budget is a record 821 trillion won, up 12.8%.
Defence spending rises 8.2% to 73.3 trillion won.

Frequently Asked Questions

How much will South Korea spend on AI and chips in 2027?

South Korea will allocate 21.3 trillion won (US$16 billion) to semiconductors, physical AI, AI data centres and AI investment. That amount is nearly double this year’s spending.

How big is South Korea’s 2027 budget?

The budget proposal totals 821 trillion won, a 12.8% increase from this year. It is the largest budget proposal on record, and parliament must still pass it.

How much is South Korea increasing defence spending in 2027?

The government wants an 8.2% increase from this year, to 73.3 trillion won. The plan targets nuclear-powered submarines and KF-21 fighter jets.

Which companies are linked to South Korea’s AI and chip spending?

The report names Samsung Electronics and SK hynix, two of the world’s three biggest memory chip makers. It does not state how the spending will flow to either company.

This article is for information only and is not buy, sell or hold advice. Do your own research before making any investment decision.

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