South Korea triples AI spending in 2026 budget plan

South Korean President Lee Jae Myung delivers the budget speech at the National Assembly in Seoul. (AFP pic)

SEOUL: South Korea will triple spending on artificial intelligence, developing infrastructure and encouraging adoption of the technology, President Lee Jae Myung said Tuesday in his annual parliamentary budget speech.

Lee said 10.1 trillion won (US$7 billion) would go towards “a major transformation aimed at propelling South Korea into the ranks of the world’s top three AI powers” with the United States and China.

“We will significantly expand investment to usher in the ‘AI era’,” Lee said, noting that the amount was more than three times the current year’s AI-related budget.

The proposal was made in a speech outlining his government’s spending plans for 2026.

Overall, the budget plan totals 728 trillion won — an 8.1 percent increase from this year.

Lee needs a majority vote in parliament to pass his budget proposal, which is likely given his party’s majority.

South Korea is home to two of the world’s leading memory chip makers, Samsung Electronics and SK hynix.

The two tech giants manufacture chips essential for AI products and the power-hungry data centres that the fast-evolving industry relies on.

Both firms recently signed preliminary deals with ChatGPT maker OpenAI to provide chips and other equipment for its Stargate AI infrastructure project.

Lee said 2.6 trillion won of next year’s AI budget “will be invested in introducing AI across industry, daily life and the public sector, while 7.5 trillion won will go towards talent development and infrastructure building”.

Jensen Huang, the CEO of US chip titan Nvidia, announced last week plans to supply 260,000 of the firm’s most advanced chips to South Korea.

After the announcement on Friday, Huang described that goal as “ambitious”.

But, he said, “there’s no reason why Korea cannot achieve it — you have the technology, you have the software expertise and you also have a natural ability to build manufacturing plants”.

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