South Korea’s new Lee Jae-myung administration is decisively advancing its AI G3 vision to become a top-three global AI power. This strategy is backed by significant financial commitments, including a KRW 100 trillion (approx. USD 73.8 billion) public-private investment fund and a KRW 1.8 trillion (approx. USD 1.3 billion) supplementary budget for AI capabilities, signalling a period of intense, state-guided development in Korea’s AI sector.
The Chief AI Officer appointment is slated for this week, with other key AI-related leadership roles at the Ministry of Science and ICT (MSIT) likely to be finalised by the end of the month. Early engagement will be key to identify strategic alignment opportunities and effectively establish positioning as foundational policies and appointments are confirmed.
Key developments
- Centralised AI governance: An AI Future Planning Chief (effectively a Chief AI Officer) has been established within the Presidential Office, as of 6 June 2025. This post will spearhead the AI G3 vision, coordinating policy with the MSIT and the National AI Committee to oversee industry development.
- Large-scale AI investment (infrastructure and chips): The KRW 100 trillion fund will enhance AI infrastructure, talent, R&D, and data. This is complemented by the KRW 1.8 trillion National AI Capability Enhancement Plan, which focuses on rapid GPU acquisition (targeting over 50,000 units, including 10,000 high-end GPUs in 2025), the rollout of AI-specific Data Centres (AIDCs) with regulatory support, and the development of a National AI Data Aggregation Cluster. There is also a strong emphasis on advancing domestic Neural Processing Units (NPUs), capitalising on South Korea’s comparative advantage in chipmaking.
- Sovereign AI model development: The World Best LLM Project will support the development of an open-source foundational large language model (LLM), potentially involving major local firms like Naver and LG via an SPC structure. This highlights the administration’s ambitions for full-stack AI capabilities and technological sovereignty.
- Robust talent pipeline: Initiatives include the AI Pathfinder Project to attract international researchers, alongside support for postdoctoral researchers and workforce training.
- Potential delays in AI Basic Act implementation: The development of subordinate regulations for the AI Basic Act (enacted January 2025) has reportedly been paused due to cabinet and leadership reshuffles. Media reports suggest the release of draft enforcement decrees and guidelines may be postponed beyond this month. Some observers note the Act’s January 2026 enforcement could also be delayed, given the new administration’s focus on innovation and industry growth.
Potential implications for businesses
While foreign technology is welcome, a strong push for local champions suggests co-opetition strategies may be effective:
- For software, platforms, and AI model developers, opportunities exist for collaboration on the World Best LLM Project, providing specialised AI services, and developing data management solutions for the National AI Data Aggregation Cluster.
- For infrastructure providers, significant demand is expected for GPUs, cloud services, and technologies for AIDCs.
- For chipmakers and semiconductor ecosystems, the domestic NPU drive, with potential mandated use in flagship projects, may present challenges for foreign chipmakers focused on proprietary hardware. Strategies could involve partnerships or focusing on other critical semiconductor value chain segments.
- Furthermore, the focus on cultivating AI talent creates partnership opportunities with universities and research institutions.
Seizing the moment
South Korea’s AI G3 agenda marks a pivotal moment in the global race for AI leadership. With sweeping investments, high-level appointments, and a strong emphasis on sovereign capability, the country is prioritising full-stack AI development. As the policy framework and funding mechanisms take shape, early alignment will be essential for businesses looking to secure long-term opportunities.
At Access Partnership, we support companies navigating the fast-moving Korean AI landscape through in-depth policy monitoring, government engagement, and strategic market entry advisory. To discuss how we can support your business in South Korea, contact [email protected].
