South Korea is preparing to announce three ambitious “mega-projects” designed to drive the country’s next era of economic expansion, including a major semiconductor hub planned for the nation’s southwest region that local media report could draw hundreds of billions of dollars in investment from Samsung and SK over several years.
The announcement represents President Lee Jae Myung’s most significant push yet to align the country’s artificial intelligence and chip industry goals with his commitment to reducing regional inequality and boosting economies outside the Seoul metropolitan area.
President Lee will lead the event, which his office has described as a national “great leap” forward. Ministries overseeing industry, science, climate, and transportation are expected to lay out specific policy support measures at the gathering.
Samsung Electronics and SK are both anticipated to share their investment plans at the event. The chairmen of those companies — Jay Y. Lee and Chey Tae-won — are among the business leaders local media expect to be in attendance. Representatives from other major companies, including LG Electronics, HD Hyundai Robotics, Korea Electric Power Corp, and Korea Water Resources Corp, are also slated to participate, according to Lee’s office.
The initiative will encompass semiconductors, AI data centers, and physical AI technologies such as robotics. Social media posts from the president pointed to a new chip cluster being developed in the southwest, including the Gwangju area and South Jeolla province — regions that have historically lagged behind the Seoul area in economic development.
Local media have reported that the total planned investments could surpass 1,000 trillion won, which is equivalent to roughly $651.41 billion, over the years ahead.
South Korean construction and engineering stocks jumped in early trading ahead of the formal announcement, as investors anticipated a wave of regional infrastructure spending. Major cement producers Asia Cement and Hanil Cement saw their shares rise 15% and 7%, respectively. Meanwhile, the broader KOSPI index fell more than 2%, with chipmakers Samsung Electronics and SK Hynix each dropping more than 4% and 3% as global tech stocks pulled back from a recent strong run.
South Korea is home to two of the world’s largest memory chipmakers — Samsung Electronics and SK Hynix — whose high-bandwidth memory chips play a central role in the global effort to develop advanced AI systems. Both companies currently operate major semiconductor facilities in and around the Seoul metropolitan area.
The government is expected to announce a wide-ranging support package that includes provisions for power supply, water access, land use, infrastructure development, workforce training, and housing.
President Lee spent part of the weekend defending the proposed southwest chip hub in a series of posts on X, pushing back against criticism that the project is intended to benefit a liberal political stronghold. He described the initiative as a “national survival strategy” aimed at easing regional imbalances and building the capacity needed for the AI era.
“The creation of a semiconductor industrial ecosystem in (the southwest) is not a special favour for a particular region,” Lee wrote in one post. “It is the additional creation of the most rational semiconductor industrial centre through the decisions of relevant companies under full government support.”
Industry analysts acknowledge that spreading chip investment beyond Seoul could help relieve infrastructure strain, but caution that constructing state-of-the-art fabrication plants demands enormous amounts of electricity and water, sophisticated logistics, extensive supplier networks, and a highly trained workforce — all of which may be difficult to develop quickly enough in a new location to keep pace with rapidly growing AI demand.
Opposition politicians have been vocal in their criticism, questioning whether the project is driven more by political calculations than economic logic, noting that 85% of voters in the southwest region supported Lee in last year’s presidential election.
The unveiling comes as Lee’s approval rating has declined for six consecutive weeks, reaching 46.5%, according to pollster Realmeter.
