South Korea plans to launch three "mega-projects" to drive its next growth phase, including a new semiconductor center in the southwest that local reports indicate might draw investments from Samsung and SK totaling hundreds of billions of dollars over the coming years.
The declaration is anticipated to signify President Lee Jae Myung's most ambitious effort to connect South Korea's AI and chip goals with his commitment to reduce regional inequalities and rejuvenate economies outside the Seoul metropolitan region.
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Lee will lead the event, described as a national "great leap" scheduled for announcement at approximately 0500 GMT, his office stated, with ministries responsible for industry, science, climate, and transport poised to present policy backing.
Samsung Electronics and SK are anticipated to unveil investment strategies, with their chairmen, Jay Y. Lee and Chey Tae-won, listed as business leaders likely to be present according to reports.
Lee's office stated that representatives from other companies like LG Electronics, HD Hyundai Robotics, Korea Electric Power Corp, and Korea Water Resources Corp are also present.
The initiative will cover semiconductors, AI data centers, and tangible AI such as robotics, according to Lee's office, while the president's social media updates indicated a new chip hub intended for the less developed southwest, comprising Gwangju and South Jeolla province.
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Shares of South Korean construction and engineering companies jumped in early trading due to expectations that the investments would lead to significant regional infrastructure development.
Leading cement manufacturers Asia Cement and Hanil Cement surged by 15 percent and seven percent, respectively. The KOSPI dropped over two percent, as chip manufacturers Samsung Electronics and SK Hynix declined more than four percent and three percent respectively, while global tech stocks paused after their recent significant surge.
In addition to Samsung Electronics, South Korea hosts SK Hynix, the world's two leading memory chip manufacturers, whose high-bandwidth memory (HBM) chips are crucial in the international competition to develop cutting-edge AI systems. Both firms currently run significant semiconductor plants in and near the Seoul metropolitan region.
The administration is poised to outline comprehensive assistance initiatives encompassing energy, water, land, infrastructure, workforce development, and housing.
Lee has supported the suggested southwest chip hub in multiple X posts throughout the weekend, dismissing claims that it favors a liberal stronghold. He presented it as a "strategy for national survival" to address regional inequalities and enhance capabilities for the AI age.
Industry specialists suggest that spreading chip investments outside of Seoul could alleviate infrastructure constraints, but caution that constructing advanced fabs necessitates significant electricity and water, sophisticated logistics, extensive supplier networks, and a highly skilled workforce—factors that might not expand swiftly enough in a new area to satisfy the rising AI demand.
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Opposition politicians have strongly condemned the proposal, doubting its political motives since 85 percent of voters in the area supported Lee in the previous presidential election.