June 29, 2026, (Inside AI) — South Korean President Lee Jae Myung will today unveil three “mega-projects” to accelerate the nation’s AI and semiconductor industries, including a new chip hub in the southwest. The announcement, framed as a “great leap,” is scheduled for around 0500 GMT, his office said.
The package spans semiconductors, AI data centres, and physical AI including robotics. It aims to fuel growth and narrow regional disparities by steering investment beyond the Seoul metropolitan area. Samsung Electronics and SK are expected to present investment plans, with chairmen Jay Y. Lee and Chey Tae-won tipped to attend.
Local media report that planned investments could exceed 1,000 trillion won ($651.41 billion) over several years. The government will detail support for power, water, land, infrastructure, workforce training, and housing. Ministries covering industry, science, climate, and transport will outline policy backing.
The southwest chip cluster targets Gwangju and South Jeolla province, an underdeveloped region. Lee defended the location on social media, calling it a “national survival strategy” to ease imbalances and expand AI-era capacity.
“The creation of a semiconductor industrial ecosystem in (the southwest) is not a special favour for a particular region,” Lee wrote. “It is the additional creation of the most rational semiconductor industrial centre through the decisions of relevant companies under full government support.”
South Korea houses the world’s two largest memory chipmakers, Samsung Electronics and SK Hynix. Their high-bandwidth memory chips are critical for advanced AI systems. Both already run major facilities near Seoul, but industry experts say diversifying could ease infrastructure bottlenecks in the capital area.
Yet building cutting-edge fabs demands vast electricity, water, advanced logistics, deep supplier networks, and highly skilled labour. Experts warn these elements may not scale quickly enough in a new region to meet surging AI demand. The plan faces sharp criticism from opposition politicians, who question its political motives given that 85% of regional voters backed Lee in last year’s election.
The announcement comes as Lee’s approval rating slid for six weeks to 46.5%, according to pollster Realmeter. Representatives from LG Electronics, HD Hyundai Robotics, Korea Electric Power Corp, and Korea Water Resources Corp are also attending the event.
Lee’s office said the projects are a direct response to the global AI race, aiming to secure South Korea’s position. The government’s comprehensive support package seeks to replicate the success of existing chip clusters while addressing regional economic decline. However, the timeline for these investments remains long-term, and execution risks loom large.
