South Korea plans massive $576bn AI-chip bet to challenge global rivals

South Korea on Monday announced sweeping chip and AI mega-projects as President Lee Jae Myung pledged to cement overwhelming industry leadership with investments worth more than $576 billion over several years.

Samsung Electronics and SK Hynix will each build two new semiconductor fabrication plants in South Korea's southwest as part of an 800 trillion won ($518 billion) national semiconductor ecosystem project.

The announcement marks the most aggressive industrial strategy any nation has undertaken to capture the AI chip market.

Investment aims to boost economic growth beyond the Seoul metropolitan region. The cities of Gwangju and South Jeolla province are seen as main beneficiaries through the construction of semiconductor plants, with further expansion planned in Chungcheong and Yeongnam areas.

According to the government’s industry minister, South Korea plans to increase production of DRAM twice in the next five years by accelerating the construction of fabs in the Seoul metropolitan area in the mid-2030s.

In May 2026, SK Hynix saw its market cap rise to $1 trillion, with its high bandwidth memory chips becoming an absolute necessity for all makers of AI hardware.

It appears that South Korea is simply unwilling to give up any ground when it comes to manufacturing chips, especially high-bandwidth ones where SK Hynix enjoys a dominant market share, amid America’s CHIPS Act, Japanese efforts to woo TSMC, and Europe’s own semiconductor aspirations.